Does the current market price of a share of stock

Assignment Help Accounting Basics
Reference no: EM132627826

Elaine Jackson gets a visit from her cousin Phil. He wants to apologize. Last year he regaled her with stories about a small company he had discovered that had just invented a high-tech converter to allow cars to run on water. It was still all hush-hush. The stock was trading for just one penny per share. Phil told Elaine he had put all his savings into it, and he wanted to share the tip with her. She purchased stock using $8,000 that she had been saving for two years. Later, when her money was long gone, she realized she had been the victim of a classic "pump and dump" scheme whereby unscrupulous promoters bought up "penny stocks," started a rumor about big profits, and when enough suckers bought in and the stock price shot up, the promoters bailed out and made a profit. Phil has just gotten out of prison, and he feels terrible about what he did. Elaine has learned an expensive lesson.

Requirements

Problem 1. Why were Phil's actions considered to be fraudulent?

Problem 2. Does the current market price of a share of stock give any indication of the value or success of a company?

Problem 3. What sort of information should an investor look for before deciding to invest in the stock of a company?

Reference no: EM132627826

Questions Cloud

What three skills or competencies do you possess : Cover letters are recommended, and in some instances required, for job applications. If you want to stand out from other candidates, you will want to write.
How do you balance satisfying demanding customers : How do you balance satisfying demanding customers with maximising cost-effective resources? Write detialed description.
How will you provide formal and informal feedback to staff : Question 1) How will you provide formal & informal feedback to staff?
How did wait time affect your overall healthcare experience : Describe a situation in which you found yourself waiting for a healthcare service. From your perspective as a patient, how did the wait time affect your.
Does the current market price of a share of stock : Elaine Jackson gets a visit from her cousin Phil. Does the current market price of a share of stock give any indication of the value or success of a company?
Understanding of the concept stereotypes : What is your understanding of the concept stereotypes?
Determining the principles of risk management : As an educator, choose one of the principles of risk management (PACED) and explain how may this principle be applied in your chosen career or work.
Journal entries in respect of peter admission : Peter purchased a one third interest of Mary for 110,000. Journal entries in respect of Peter admission in the business under the above cases
What is the service delivery system : What is the service delivery system and why is it important in providing excellent customer service? Select two facilities within your home state and describe.

Reviews

Write a Review

Accounting Basics Questions & Answers

  I a full-time equivalent fte is paid for 2080 hours and

assume that a home health agency requires 6000 nursing care hours. if a full-time equivalent fte is paid for 2080 hours

  Treatment on the bank reconciliation problem

If a check correctly written and paid by the bank for $626 is incorrectly recorded on the company's books for $662, the appropriate treatment on the bank reconciliation would be to do which of the following?

  Why should develop an hrm strategic plan

Why should you develop an HRM strategic plan? Which components of your HR plan will you have to change? What additional information would you need to create

  A statement of net position for the euef

repare the journal entries necessary to record these transactions in the EUEF Prepare a statement of revenues, expenses, and changes in net position Prepare a statement of net position for the EUEF.

  Composition of the city youth

The New York Civil Liberties Union points out that of 26,181 police officers, 64.8% are white, 14.5% black, 19.1% Hispanic, and 1.4% Asian. Do the police officers reflect the ethnic composition of the city's youth?

  Excel 2010 provides the capability to exchange data with

excel 2010 provides the capability to exchange data with other applications. discuss the different types of ways to

  Record the tax levy in the general fund

Record the tax levy for 2011 in the General Fund. (Ignore subsidiary detail and entries at the government-wide level.)

  Cumulative effect of the accounting change

Assume that the income tax rate for all years is 30%. The cumulative effect of the accounting change should be reported by Playtime in its 2013

  The equity of webster corporations balance sheet shows the

the equity of webster corporations balance sheet shows the following preferred stock-- 5 cumulative 10 par value 15

  Describe any lease obligations the company disclosed

Describe any lease obligations the Company disclosed. Explain what contingency liabilities are disclosed in the financial statements.

  What sources of income must edge consider

What sources of income must Edge consider to determine if the income requirements for a personal holding company have been met

  Compute the unit contribution margin and the units

Compute the unit contribution margin and the units that must be sold to break even. Suppose that 30,000 units are sold above the break-even point

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd