Customer-Supplier Relationships and the Cost of Debt

Authors

  • Hoontaek Seo Niagara University
  • Sangho Yi Sogang University
  • Kyoung-min Kwon Hongik University

Keywords:

Accounting, Finance, Costumer, Supplier, Cost of Debt

Abstract

We examine the relation between the existence of a large customer and the cost of debt financing. We find that credit ratings are lower for firms with a large customer. We also find that yield spreads are higher for firms with a large customer. The results indicate that firms having a large customer have higher cost of debt financing, which is consistent with our capital structure hypothesis.

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Published

2017-09-01

How to Cite

Seo, H., Yi, S., & Kwon, K.- min. (2017). Customer-Supplier Relationships and the Cost of Debt. Journal of Accounting and Finance, 17(6). Retrieved from https://articlegateway.com/index.php/JAF/article/view/929

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Section

Articles