Respuesta :
Answer: Option C
Explanation: In case of companies having both debt and equity in its capital structure only the interest paid on debt is deductible to tax and the dividends distribution to stockholders is done from the net income which is computed after deducting tax.
Thus, from the above explanation we can conclude that option c is incorrect statement.
Interest expense incurred when borrowing money, as well as dividends paid to stockholders, are both tax-deductible is not a true statement. It does not involve other companies getting payed for one companies sales.