If subsequently resold for a sum larger than the cost, Alcoa should report for the sale of the treasury stock by debiting cash for the sale cost, crediting treasury stock for cost, and crediting additional paid-in capital from repurchased stock for the excess of the selling price over the cost. Adversely, if the stock is retired, Alcoa
Calculate the following financial ratios. TIP: If you don't remember how to calculate financial ratios, review the Calculating Financial Ratio pages from Section 9, Lesson 2 of this course. a. A company makes a net profit before tax of $12,000 and has $20,000 in total equity. Calculate the company's return on equity as a percentage.
J. Premium offers outstanding- Current Liability K. Discount notes payable- Current Liability L. Employee payroll deductions unremitted- Current Liability M. Current maturities of long-term debts to be paid from current assets- Current Liability N. Cash dividends declared but unpaid- Current Liability O. Dividends in arrears on preferred stock- Footnote disclosure P. Loans from officers- Current Liability 13-2. Accounts and Notes Payable * The following are selected 2012 transactions of Darby Corporation. Sept. 1 | Purchased inventory from Orion Company on account for $50,000.
1.5E. 2.0 | 5 | c | During the year, Kitchen Supply increased its accounts receivable by $130, decreased its inventory by $75, and decreased its accounts payable by $40. How did these three accounts affect the firm's cash flows for the year? A. $245 use of cashB.
$2,040,500 B. $2,212,500 C. $2,260,500 D. $2,171,500 E. $2,071,500 Difficulty: Medium 4. A company should always use the equity method to account for an investment if A. It has the ability to exercise significant influence over the operating policies of the investee B. It owns 30% of another company's stock C. It has a controlling interest (more than 50%) of another company's stock D. The investment was made primarily to earn a return on excess cash E. It does not have the ability to
Page 484 has formulas!! 6. When the firms maintains a target leverage ratio, we compute its levered value V^L as the present value of its free cash flows using the WACC, whereas its unlevered value V^U is the present value of its free cash flows using its unlevered cost of capital or pretax WACC. 15.3 Recapitalizing to Capture the Tax Shield 1. when securities are fairly priced, the original shareholders of a firm capture the full benefit of the interest tax shield from an increase in leverage 15.4 Personal
2. Prepare a formal journal entry to record the treasury stock transaction. Treasury stock 400,000 Cash 400,000 3. Identify the specific paragraph of the FASB Codification which addresses this issue and submit a printout of this paragraph with your solution. Codification 505-30-30-3 guides that “If the purchase of treasury shares includes the receipt of stated or unstated rights, privileges, or agreements in addition to the capital stock, only the amount representing the fair value of the treasury shares at the date the major terms of the agreement to purchase the shares are reached shall be accounted for as the cost of the shares
Total losses for the four days: $30 billion, 10 times federal budget and more than the U.S. had spent in World War I ($32B estimated). The crash wiped out 40 percent of the paper value of common stock. Although this was a cataclysmic blow, most scholars do not believe that the stock market crash, alone, was sufficient to have caused the Great Depression. And the next possible cause is bank failure.In 1929, there were 25,568 banks in the United States; by 1933, there were only 14,771. Personal and corporate savings dropped from $15.3 billion in 1929 to $2.3 billion in 1933.
Bond Interest Income of $ 160,000 was accrued at the end of year. Refunds of $ 150,000 were made in cash to terminated, non-vested participating employees. Common stocks, which are carried at a fair value of $ 500,000, were sold for $472,000. The amount of the sales price of the stock plus an additional $ 360,000 was invested in stocks. As of the end of the fiscal year, June 30, 2012, a determination has been made that the fair value of the stocks held by the pension plan had decreased by $ 60,000; the fair value of bonds had increased by $35,000.
Cash Analysis Based on the information provided by Mr. Cowins, an analysis of cash funding and usage that Hampton had from November 1978 to August 1979 is below: Change in Cash Funding Usage Increase in bank debt $1,000,000 Stock repurchase $3,000 Increase in retained earnings $883,000 Increase in inventories 2,163 Decrease in cash $961,000 Decrease in accruals 9 Increase in customer advances $726,000 TOTAL USES OF CASH $5,172 Increase in accounts payable $600,000 Decrease in accounts receivable $561,000 Increase in taxes payable $329,000 Decrease in net fixed assets $92,000 Decrease in prepaid expenses $20,000 Total Cash Funding $5,172,000 According the analysis above, there is a large amount of cash disburses to inventories that drain out the cash on hand that Hampton has. The total amount of change in cash,