Which are riskier—bonds or preferred stock? Why? Whose perspective are you taking—the issuer’s or the investor’s?
Answer to relevant QuestionsWhy do U.S. GAAP and IFRS require recognition of an expense when a company grants stock options to its employees?Your friend has decided that par value of common stock is a meaningless notion and complicates accounting practice without adding value to the financial statements. How do you respond? Restrictions on dividend-declaring power may be voluntary or involuntary. Give an example of each.The following are account balances of Reliable Autos, Inc. ($ in thousands): Common Stock and Retained Earnings, $350; Accounts Payable, $350; Preferred Stock (5,000 shares; $20 par and $24 liquidating value per share), ...Assume that during 2011, Tompkins Financial Corporation repurchased 1,500 of its own shares at an average price of $38.67 per share. Par value was $.10 per share. Assume the shares were originally issued for $28. 1. Prepare ...
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