Question
in 2018, RVT had zero debt. Assume that in 2018 RVT adds $1 million of debt with a 5% annual interest payment. Will profit margin
in 2018, RVT had zero debt. Assume that in 2018 RVT adds $1 million of debt with a 5% annual interest payment. Will profit margin change because of the additional debt?
A. debt is a balance sheet item so profit margin doesn't change
B. debt is not an operating expense so profit margin does not change
C. it will change due to interest expense
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Financial Management
Authors: Rajiv Srivastava, Anil Misra
2nd Edition
0198072074, 9780198072072
