ForeEver Yours, Inc., a manufacturer of wedding rings, issued two financial instruments at the beginning of 2017:

Question:

ForeEver Yours, Inc., a manufacturer of wedding rings, issued two financial instruments at the beginning of 2017: a $10 million, 40-year bond that pays interest at the rate of 11% annually and 10,000 shares of $100 preferred stock that pays a of 7.5% annually. The preferred stock has a mandatory redemption feature that requires the company to repurchase all outstanding shares at par ($100 per share) in 40 years.
Required:
Describe how each financial instrument will affect the company's and income statement in 2017.
Balance Sheet
Balance sheet is a statement of the financial position of a business that list all the assets, liabilities, and owner’s equity and shareholder’s equity at a particular point of time. A balance sheet is also called as a “statement of financial... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...