If a company uses $100 million in cash to pay off debt,its shareholders' equity will increase by $100 million.

Name: If a company uses $100 million in cash to pay off debt,its shareholders' equity will increase by $100 million.
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Question

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When a company uses its cash to pay off debt, it reduces its assets (cash) by $100 million and also reduces its liabilities (debt) by $100 million, resulting in no change to shareholders' equity.

If a Company Uses $100 Million in Cash to Pay