Mr. Shawn owns 1000 shares of the common stock of C corporation with a market value of 20 per share, or 20,000 overall. The company is currently financed as follows, Equity(10,000 shares) with Market value of Rs.200,000 and Debt with a market value of Rs.100000. C corporation now announces that it is replacing Rs.10,000 of debt with an issue of common stock. Whta action can Mr. Shawn take to ensure that he is entitled to exaclty the same proportion of profits as before?

Answer rating: 100% (QA)

MrShawn can take two main actions to ensure he maintains the same proportion of profits after C corporation replaces Rs10000 of debt with common stock ... View the full answer