Most investors would prefer to see equity rather than debt on the balance sheet.

Question

Quizplus · Accepted Answer

Equity represents ownership and a higher equity on the balance sheet indicates that the company is relying less on borrowed funds. This is generally viewed positively by investors as it indicates a stronger financial position and potentially higher returns on their investment. Debt, on the other hand, represents a liability for the company and may increase the risk of default or bankruptcy.

Most Investors Would Prefer to See Equity Rather Than Debt