Dual classes of common stock are common in a number of countries. Assume that Yehti Manufacturing has
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Dual classes of common stock are common in a number of countries. Assume that Yehti Manufacturing has the following capital structure at book value. The A-shares have ten votes per share adn the B-shares have one vote per share.
Yehti Manufacturing | Local Currency (millions) |
Long-term debt | 200 |
Retained earnings | 300 |
Paid-in common stock: 1.0 million A-shares | 100 |
Paid-in common stock: 4.0 million B-shares | 400 |
Total long-term capital | 1,000 |
a. what proportion of the total long-term capital has been raised by A-shares?
b. What proportion of voting rights is represented by A-shares?
c. What proportion of the dividends should the A-shares receive?
Related Book For
Multinational Business Finance
ISBN: 978-0133879872
14th edition
Authors: David K. Eiteman, Arthur I. Stonehill, Michael H. Moffett
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