Which of the following statements is false regarding the issuance of stock versus bonds to raise capital for a corporation?

Finance

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Which of the following statements is false regarding the issuance of stock versus bonds to raise capital for a corporation?

A) The declaration of dividends reduces the amount of corporation’s taxable income
B) Interest accrues; whereas, dividends do not accrue
C) The payment of bond interest is a contractual requirement
D) The declaration of dividends is at the discretion of the board of directors

Answer: A

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