* _______ assets generate net income to the economy and ___________ assets define allocation of income among investors.
a) Financial, financial b) Financial, real c) Real, financial d) Real, real
* In the event of a firm’s bankruptcy, __________.
a. the firm’s stockholders are personally liable for the firm’s obligations.
b. the most the shareholders can lose is their original investment in the firm’s stock.
c. common shareholders are first in line to receive their claims on the firm’s assets.
d. bondholders have claim to what is left from liquidation of the firm’s assets.
The correct answer will be option c i.e. real, financial
The correct answer will be option b i.e. the most the shareholders can lose is their original investment in the firm’s stock.
Feel free to ask in case of any query relating to this question
* _______ assets generate net income to the economy and ___________ assets define allocation of income...
Please choose a letter answer and explain the answer please. You own shares of the Illuminati Company. The current price is $80 a share. You want to limit your potential losses if the stock falls so you tell your broker to sell out your shares if the price drops to $70 a share. The type of order you would place is a stop buy a stop sell a limit buy a limit sell assets generate net income to the...
Problem 24-01 Focusing on Liquidation -
Southwestern Wear Inc. has the following balance sheet:
Current assets $1,875,000
Accounts payable $375,000
Fixed assets 1,875,000
Notes payable 750,000
Subordinated debentures 750,000
Total debt $1,875,000
Common equity 1,875,000
Total assets $3,750,000
Total liabilities and equity $3,750,000
The trustee's costs total $247,000, and the firm has no accrued
taxes or wages. Southwestern has no unfunded pension liabilities.
The debentures are subordinated only to the notes payable. If the
firm goes bankrupt and liquidates, how...
8. Liquidations in bankruptcy Aa Aa When a business is worth more if its assets are sold than if it continues to operate, then the business is liquidated, and the proceeds from the sale are used to satisfy any outstanding debt. Liquidation occurs when businesses file for bankruptcy under Chapter 7 of the Federal Bankruptcy Reform Act. This act provides for an equitable distribution of the debtor's assets among the creditors. The distribution of assets is governed by a certain...
Liquidation Southwestern Wear Inc. has the following balance sheet: Current assets $1,875,000 Accounts payable $375,000 Fixed assets 1,875,000 Notes payable 750,000 Subordinated debentures 750,000 Total debt $1,875,000 Common equity 1,875,000 Total assets $3,750,000 Total liabilities and equity $3,750,000 The trustee's costs total $256,250, and the firm has no accrued taxes or wages. Southwestern has no unfunded pension liabilities. The debentures are subordinated only to the notes payable. If the firm goes bankrupt and liquidates, how much will each class of...
Liquidation Southwestern Wear Inc. has the following balance sheet: Current assets $1,875,000 Accounts payable $375,000 Fixed assets 1,875,000 Notes payable 750,000 Subordinated debentures 750,000 Total debt $1,875,000 Common equity 1,875,000 Total assets $3,750,000 Total liabilities and equity $3,750,000 The trustee's costs total $255,250, and the firm has no accrued taxes or wages. Southwestern has no unfunded pension liabilities. The debentures are subordinated only to the notes payable. If the firm goes bankrupt and liquidates, how much will each class of...
Liquidation Southwestern Wear Inc. has the following balance sheet: Current assets $1,875,000 Accounts payable $375,000 Fixed assets 1,875,000 Notes payable 750,000 Subordinated debentures 750,000 Total debt $1,875,000 Common equity 1,875,000 Total assets $3,750,000 Total liabilities and equity $3,750,000 The trustee's costs total $331,750, and the firm has no accrued taxes or wages. Southwestern has no unfunded pension liabilities. The debentures are subordinated only to the notes payable. If the firm goes bankrupt and liquidates, how much will each class of...
Problem 24-01 Liquidation Southwestern Wear Inc. has the following balance sheet: Current assets $1,875,000 Accounts payable $375,000 Fixed assets 1,875,000 Notes payable 750,000 Subordinated debentures 750,000 Total debt $1,875,000 Common equity 1,875,000 Total assets $3,750,000 Total liabilities and equity $3,750,000 The trustee's costs total $295,500, and the firm has no accrued taxes or wages. Southwestern has no unfunded pension liabilities. The debentures are subordinated only to the notes payable. If the firm goes bankrupt and liquidates, how much will each...
Problem 24-01 Liquidation Southwestern Wear Inc. has the following balance sheet: Current assets $1,875,000 Accounts payable $375,000 Fixed assets 1,875,000 Notes payable 750,000 Subordinated debentures 750,000 Total debt $1,875,000 Common equity 1,875,000 Total assets $3,750,000 Total liabilities and equity $3,750,000 The trustee's costs total $280,250, and the firm has no accrued taxes or wages. Southwestern has no unfunded pension liabilities. The debentures are subordinated only to the notes payable. If the firm goes bankrupt and liquidates, how much will each...
Liquidation Southwestern Wear Inc. has the following balance sheet: Current assets $1,875,000 Accounts payable $375,000 Foxed assets 1.675.000 Notes payable 750,000 Subordinated debentures 750.000 Total debt $1,875,000 Common equity 1,875,000 Total assets $3,750,000 Total liabilities and equity $3,750,000 The trustee's costs total $285,250, and the form has no accrued taxes or wages. Southwestern has no unfunded pension lib .The debentures are subordinated the firm goes bankrupt and liquidates, how much will each class of investors receive it a total of...
eBook Problem Walk-Through Problem 24-01 Liquidation Southwestern Wear Inc. has the following balance sheet: Current assets $1,875,000 Accounts payable $375,000 Fixed assets 1,875,000 Notes payable 750,000 Subordinated debentures 750,000 Total debt $1,875,000 Common equity 1,875,000 Total assets $3,750,000 Total liabilities and equity $3,750,000 The trustee's costs total $207,500, and the firm has no accrued taxes or wages. Southwestern has no unfunded pension liabilities. The debentures are subordinated only to the notes payable. If the firm goes bankrupt and liquidates, how...