Why is fasb now addressing the issue of what is debt

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Reference no: EM133340931

Question: The classification and measurement of items as liabilities may not always be straightforward. In recent years, compound financial instruments have emerged which contain both liability and equity components.

1. Summarize the reasons why a corporation may wish to issue debt rather than equity securities - why does it matter?

2. Why is FASB now addressing the issue of what is debt and what is equity? is the most popular type of instrument that FASB is addressing (PwC also stresses in the podcast).

3. Choose one factor that may be employed to determine if a particular financial instrument is a debt or equity security and discuss how it is used (there are many possible factors in the readings). Are all of these factors clear-cut or is professional judgment required?

Reference no: EM133340931

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