Describe how acquisition affects number balance sheet

Assignment Help Financial Management

Reference no: EM13847487

The book value of Little Statistic’s total assets is $400,000. Suppose Number Crunching Inc. acquires Little Statistic’s assets for $1 million and finances the purchase by selling $600,000 in new stock, $300,000 in new debt, and reducing cash by $100,000. Describe how the acquisition affects Number Crunching’s balance sheet.

Reference no: EM13847487

Questions Cloud

Considering the purchase of a warehousing facility : AMF Corporation is considering the purchase of a warehousing facility. AMF plans to finance this by borrowing the entire purchase price of the warehouse at a 10% annual interest rate for 20 years. If the purchase price of the warehouse is $200,000, w..

The account paid interest compounded annually : John Adams opened a bank saving account with $5,000 15 years ago. Today, the account balance is $$12,000. If the account paid interest compounded annually, how much interest on interest was earned?

What was the annual percentage rate of consumer loan : On February 1, 2013, Mr. Smith purchased $1,000 worth of furniture from a furniture store. The purchase was financed by a consumer loan which required Mr. Smith to pay a monthly payment of $37.78 at the end of each month for three years. What was the..

What is the earnings and dividend per share figure : Draiman, Inc., has sales of $600,000, costs of $258,000, depreciation expense of $63,500, interest expense of $30,500, and a tax rate of 40 percent. The firm paid out $43,500 in cash dividends and has 55,000 shares of common stock outstanding. What i..

Describe how acquisition affects number balance sheet : The book value of Little Statistic’s total assets is $400,000. Suppose Number Crunching Inc. acquires Little Statistic’s assets for $1 million and finances the purchase by selling $600,000 in new stock, $300,000 in new debt, and reducing cash by $100..

Why is this figure different from its accounting income : During 2011, Lele Design earned net income of $250,000. The firm neither bought nor sold any capital assets. The book value of its assets declined by the year’s depreciation charge of $200,000. The firm’s operating cash flow for the year was $450,000..

Global financing and exchange rate topics : Explain how your topic is used in global financing operations and describe its importance in managing risks.

What must the liquidating dividend be : JJ Industries will pay a regular dividend of $2.3 per share for each of the next four years. At the end of the four years, the company will also pay out a liquidating dividend. If the discount rate is 7 percent, and the current share price is $64. Wh..

Stock with margin and without margin : Suppose you sell the stock at a price of $37. What is your return? What would your return have been had you purchased the stock without margin?

User Account

All Pages