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debt and equity- TA

Aaarti5y ago
Economic necessity does not result in a financial liability being classified as a liability. dear tutor i didnt quite get this line from technical article, "when does debt seem to be equity"?. what does economic necessity mean here? can you possibly explain sentence as a whole with an example?
stephenwidbergstephenwidbergTutor5y ago#1
I think he means that it the business’s intentions to redeem or not redeem are irrelevant. What matters is whether the terms of the instrument could force them to redeem. Best I can do on that one!
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