Reference no: EM13258851
Three different plans for financing a $15,000,000 corporationare under consideration by its organizers. Under each of thefollowing plans, the securities will be issued at their par or faceamount, and the income tax rate is estimated at 40% ofincome. Plan1 Plan2 Plan3
12%bonds $6,250,000
Preferred $4 stock, $50par $7,500,000 5,000,000
Common stock, $30par $15,000,000 7,500,000 3,750,000
TOTAL $15,000,000 $15,000,000 $15,000,000
NSTRUCTIONS: 1. Determine for each plan the earnings per share ofcommon stock, assuming that the income before bond interest and income tax is$2,500,000. 2. Determine for each plan the earnings per share ofcommon stock, assuming that the income before bond interest and income tax is$1,500,000. 3. Discuss the advantages and disadvantages of each plan.
|
Beginning inventory and purchases
: A company reports the following beginning inventory and purchases for January. On January 26, 355 units were sold. What is the cost of the 160 units that remain in ending inventory
|
|
Balance on the debtors account
: During a three month period a business made sales of $69200 plus vat at 17.5% the balance on the debtors account at the start ofthe period was $5329 and at the end of the period $4711.
|
|
What is the firms value of operations
: If the weighted average cost of capital is 14%, what is the firm's value of operations, in millions?
|
|
Find out the percent ionization
: Determine the percent ionization of the following solutions of formic acid at 25 degrees centigrade (C) : a) 0.016 M, b) 5.7 X 10^-4, c)1.75 M
|
|
Determine for each plan the earnings per share
: Determine for each plan the earnings per share of common stock, assuming that the income before bond interest and income tax is$2,500,000.
|
|
African americans during the two phases of slavery
: How in significant ways did Antonio , otherwise known as Anthony Johnson, and John punch help unconsciously to define two different kinds of unequal laws which affected two types of African Americans during the two phases of slavery?
|
|
What is the net force the hinge exerts on the beam
: A purple beam is hinged to a wall to hold up a blue sign. The beam has a mass of mb = 6.1 kg and the sign has a mass of ms = 16.6 kg. What is the net force the hinge exerts on the beam
|
|
What is the study of art as product
: What is the study of art as product of its broad cultural context? naturalism iconography aesthetics contextualism The painting Red Canna would be best described by which of the following terms?
|
|
What is the force the left support exerts on the beam
: Now the gymnast (not holding any additional mass) walks directly above the right support. What is the force the left support exerts on the beam
|