Week 8

Week 8 - 379000 Less: BV attributed to P/S 33600 toal BV...

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P11-27A (10-20min) Req. 1 Req. 2 Req. 3 They would need to issue 40,000 shares to raise $2,000,000. (2000000/50=40000 The main advantage they gain by selecting a coporate form of business now wo money, which means that cash flow wont be an issue as they grow I would suggest that they initially issue common stock, as it's not cumulative. don't have to pay dividends.
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0) ould be that corporations can raise more So if the business isn't doing well, they
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P11-29A (15-20 min) Req. 1 Req. 2 The total paid-in capital of the company is $289,000 Req. 3 The total market value of the common stock is $310, 000 (10000 shares x $31) Req. 4 The BV per share of Common stock is $34.54 Preferred Stock 30000 Dividends in Arrears 3600 Total BV attributed to P/S 33600 Total Stockholders Equity
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Unformatted text preview: 379000 Less: BV attributed to P/S 33600 toal BV attributed to C/S 345400 Outstanding Common shares 10000 BV per share on C/S 34.54 The preferred stock is cumulative because all preferred stock is cumulative UNLESS doesn't. it states otherwise, which this one P11-35A (15-20 min) Req.1 Income Statement MACRS Total revenue $910,000 $910,000 Total expenses $700,000-$725,000 Taxable income $210,000 $185,000 Req.2 Journal Entry Accounts Debit Credit Income tax expense 84,000 Income tax payable 74,000 Deferred tax liability 10,000 Req.3 Balance Sheet (Partial) Debit Credit Current liabilities: Income tax payable $74,000 Long–term liabilities: Deferred tax liability 10,000 P...
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This note was uploaded on 09/11/2011 for the course TERM 1 taught by Professor Smith during the Spring '11 term at FIT.

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Week 8 - 379000 Less: BV attributed to P/S 33600 toal BV...

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