Question

Which of the following is not an advantage of issuing bonds instead of common stock? tax savings result income to common shareholders may increase earnings per share on common stock may be lower stockholder control is not affected

Answer 1

Answer: earnings per share on common stock may be lower

Step-by-step explanation:

Some of the advantages of the issuance of bonds instead of common stock is that it helps in saving tax.

Also, the income to the common shareholders may increase and there is no impact on the control of the stockholder.

It should be noted that "earnings per share on common stock may be lower" isn't an advantage of issuing bonds instead of common stock.