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Which of the following is FALSE regarding the difference between debt and common stock? 1. Equity is ownership in a firm but debt is not.
Which of the following is FALSE regarding the difference between debt and common stock?
1. | Equity is ownership in a firm but debt is not. | |
2. | Stockholders have voting power while creditors do not. | |
3. | Periodic payments made to either class of security are tax deductible for the issuer. | |
4. | Interest payments are legally binding while dividend payments generally are not. | |
5. | A publicly-traded company can issue public stock and private debt, but not vice versa. |
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