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?
Answer to relevant QuestionsIn recent years, the McFarlane Company had severe cash flow problems. In 20X0, the company suspended payment of cash dividends on common stock. In 20X1, it ceased payment on its $3 million par value 6% cumulative preferred ...Why does a conversion option make bonds or preferred stock more attractive to investors?Disposal Services, Inc., a waste management company, had 3.5 million shares of common stock authorized on August 31, 20X2. Shares issued were 2 million. There were 375,000 shares held in the treasury. How many shares were ...On April 25, 2012, Coca-Cola announced its first stock split in 16 years and only its eleventh stock split since the stock began trading in 1919. In July the stockholders approved the two for one split, which gave each ...Many corporations have automatic dividend reinvestment plans. Individual shareholders may elect not to receive their cash dividends. Instead, an equivalent amount of cash is invested in additional stock (at the current ...
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