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Author Question: The purpose of the restrictive debt covenant that imposes fixed assets restrictions is to ________. ... (Read 59 times)

evelyn o bentley

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on: Jul 11, 2018
The purpose of the restrictive debt covenant that imposes fixed assets restrictions is to ________.
 
  A) protect the lender by controlling the risk and marketability of the borrower's security investment alternatives
  B) limit the amount of fixed-payment obligations
  C) ensure a cash shortage does not cause an inability to meet current obligations
  D) prevent the firm from liquidation and ensure its ability to repay the debt

Question 2

The net proceeds used in calculation of the cost of long-term debt are funds actually received from the sale after paying for flotation costs and taxes.
 
  Indicate whether the statement is true or false


deja

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Reply #1 on: Jul 11, 2018
Answer to Question 1

D

Answer to Question 2

TRUE


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