What are the main differences between corporate debt and
equity? Why do some firms try to issue equity in the guise
of debt?
Answer Posted / deepak mistry
corporate debt requried to pay fixed rate of interest and
it is mandentory in nature.however,on equity company may
pay dividend or not as the case.
At the time of liquidation corporate debt
have preferntial right and equity holdre have secondary
right after debt.
payment to corpo. debt is compulsory in
nature they has to paid even by calling money from equity
holder.payment to equity share holder has to made out
current profit or accumalted profit of company.
| Is This Answer Correct ? | 6 Yes | 3 No |
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