Accounting Multiple Choice Question – 24 August 2022

A company has decided to increase its gearing.

By which method can this be achieved?

Select ONE answer:

1. increasing retained profits
2. issuing additional debentures
3. issuing new ordinary shares
4. redeeming debentures

Show your workings to arrive at your answer, and explain and justify your reasons:

……………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………………

This multiple-choice question is suitable for Accounting KS5 classes.

The answer is 2

1. Not correct
2. Correct
3. Not correct
4. Not correct

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