ly based on tax rate structure may be less than optimal.

Intermediate Accounting: Reporting And Analysis
3rd Edition
ISBN:9781337788281
Author:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Publisher:James M. Wahlen, Jefferson P. Jones, Donald Pagach
Chapter14: Financing Liabilities: Bonds And Long-term Notes Payable
Section: Chapter Questions
Problem 2GI: Why does issuing debt result in an income tax advantage when compared to issuing equity?
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Discuss why evaluating vertical equity simply based on tax rate structure may be less than optimal.

 
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