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You have been asked to prepare a presentation for the board of directors, regarding the methods for financing business operations. They would like answers to the following questions concerning the use of debt or equity as financing vehicles.

What factors would cause our corporate management to obtain cash by issuing bonds, instead of selling stock?

In what situations would management be wise to issue additional common stock, rather than bonds, to meet long term capital needs?

Should we issue common or preferred stock, as the preferred method of raising cash through equity financing?

What factors should we consider if we decide to issue a debt instrument to raise cash?

Should we obtain additional equipment through the purchase or lease of said equipment?

Prepare your answers in a format that will allow you to present the information at the monthly board meeting. You may use either word processing or presentation software to prepare your presentation.

Gore Inc. has outstanding 10,000 shares of $10 par value common stock. On July 1, 2008, Gore reacquired 100 shares at $85 per share. On September 1, Gore reissued 60 shares at $90 per share. On November 1, Gore reissued 40 shares at $83 per share. Prepare Gore s journal entries to record these transactions using the cost method.

Choose three companies. Select a company from each of the following three sectors: Manufacturing, Service, and Retail Sales. One company must be foreign. Compute the quick and current liquidity ratios, and the dupont ratio for the three companies.

As an investor, would you prefer a stock dividend, cash dividend or stock split? Why? How do each of these impact a company s financial statement? What are some benefits of a stock split for a company? What are some benefits for an investor? Why would a company choose one over the other?

Should an organization issue common stock, preferred stock, or bonds to raise capital? Why? As an investor, how would you prefer to see a company raise capital? Why? As a corporation, would you rather issue preferred or common stock? Why?