Accounting for IGCSE & O level - Preparation Of Financial Statements (Section 23 - No. 44)
What is the impact on a company's financial statements if a company issues a bond?
Increase in equity and decrease in liabilities
Decrease in equity and decrease in liabilities
Increase in liabilities and decrease in equity
Increase in liabilities and no impact on equity.
Explanation
Issuing a bond increases liabilities (debt) while not affecting equity.
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