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<p><em><strong>I. Both debt and equity security holders have an ownership interest in the corporation.</strong></em></p> <p><em><strong>II. Both debt and equity securities have an obligation to pay income.</strong></em></p> <p><em><strong>a. I only.</strong></em></p> <p><em><strong>b. II only.</strong></em></p> <p><em><strong>c. Both I and II.</strong></em></p> <p><em><strong>d. Neither I nor II.</strong></em></p>
Answer D. B/s
1. Some debt holders doesn't have ownership interest. They are usually short term interest.
2. For Equity securities companies are not expected to pay out of income unless the the company board agreed so for different reason. For Debt securities companies are required to pay out of income other wise there will be legal consequence for failure to do so.
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answer D :
d. Neither I nor II.
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