Asked by Ailsa Hansen on May 12, 2024
Verified
The two forms of equity infusion are:
A) long term debt and common stock.
B) direct investment in the company's stock and the retention of earnings.
C) net working capital and accumulated depreciation.
D) preferred stock and long-term debt.
E) dividends and retained earnings.
Equity Infusion
Capital that is provided to a company in exchange for partial ownership, often used to boost the company's growth or stabilize its financial health.
Retention of Earnings
The portion of net income that is retained by a company rather than distributed to its shareholders as dividends, often used for reinvestment.
Common Stock
Equity ownership in a corporation, giving holders voting rights and a share in the company's profits through dividends or stock appreciation.
- Identify and differentiate the forms of equity infusion and their impact on a company’s financial structure.
Verified Answer
Learning Objectives
- Identify and differentiate the forms of equity infusion and their impact on a company’s financial structure.
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