A company interns to finance its business expansion by issuing preferred stock, common stock and bonds 1)
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Question:
A company interns to finance its business expansion by issuing preferred stock, common stock and bonds
1) preferred stock price is 110$ per shareand 150,000 shares issued
2) common stock price is 50$ per share and 500,000 shares issued
3)Debt price is 1000$ and 60,000 bonds sold
Calculate themarket valueof the following:
a) Preferred stock
b)Common stock
c) Debt
d) what is the total market value of common stock, preferred stock and Debt issued by the company?
e) calculate the weight of each of common stock, preferred stock and Debt using the formula
-common stock/ (total market value)x100%
-Preferred stock/(total market value)x100%
-Debt/(total market value)x100%
Related Book For
Financial and Managerial Accounting
ISBN: 978-0132497978
3rd Edition
Authors: Horngren, Harrison, Oliver
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