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LOS f: Compare and contrast the risks of creditors and owners.
Q1. Which of the following statements concerning a firm's creditors and equity holders is most accurate?
A) In a bankruptcy liquidation, creditors and equity holders will divide the remaining assets of the business proportionately to their claims.
B) In the event of bankruptcy, equity holders are not legally entitled to receive anything unless creditors are paid in full.
C) The priority claim of equity holders gives them more safety than creditors if bankruptcy occurs.
Q2. Which of the following describes an advantage that equity holders of a business have over creditors?
A) Dividend payments are more reliable than interest payments.
B) Priority claim on assets in the event of bankruptcy.
C) Ability to hire or fire managers. | 
发表于 2009-3-4 11:32
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