What is the least costly form of long-term financing? - Preference or preferred shares - Rights...
What is the least costly form of long-term financing?
- Preference or preferred shares
- Rights
- Ordinary or common shares
- Loans
Homework Answers
Ans: Among the following least costly form of long term financing is
- Rights Share
Reason : As the sources of long term sources of finance are having the following merits and demerits
- Preference Share- It is having a fixed rate of interest to be paid as a dividend but with a clause that he will be paid earlier than the equity share holders in turn reducing there share of profit left over as well as for the firm to reinvest the same and on the other side its cost of issue is more as the company needs to pay the underwriter commission for issuance of the same.
- Rights Share : As it a part of retained earnings which a company is having and the cost to issue the same is low as compare to other instruments as a source of long term finance being issue by the company in creating and increasing the wealth of share holder.
- Common Share-The cost to raise funds in the form of equity share are high making it a costly affair for the firm.
- Loans : It carries a fixed rate of interest and a lien against the companies assets making it more expensive as compare to other instruments.
Add Answer to:
What is the least costly form of long-term financing?
- Preference or preferred shares
- Rights...
The typical rights of preferred shares usually include: Multiple Choice O a preference to a predesignated...
The typical rights of preferred shares usually include: Multiple Choice O a preference to a predesignated amount of dividends, that is a stated dollar amount per share or percent of per per share. O C ) the "preemptive right to maintain one's percentage share of ownership when new shares are issued O the night to vote O a preference over common shareholders and leaders in the distribution of assets in the event the corporation is dissolved o < Prey 28...
determine how the firm is financing investment in assets: long-term debt, preferred stock, and common stock...
determine how the firm is financing investment in assets: long-term debt, preferred stock, and common stock This question is based on Estee Lauder 2018 balance sheet
What long term debt instruments docorporations use? How can leasing be a type of long term...
What long term debt instruments docorporations use? How can leasing be a type of long term financing? What are the differences between financing with common stock and preferred stock
ASC had ordinary as well as preference shares. However, the preference shares are considered “callable”. The par value f...
ASC had ordinary as well as preference shares. However, the preference shares are considered “callable”. The par value for the preference shares is $30 and the dividends is 3.25%. It is important to note that according to IFRS, callable preference shares (also known as mandatory redeemable preference shares) are treated as debt and not equity. This will have to be reflected in the statements that ASC has to produce for the listing on the ASX. Requirement : Provide the income...
What are the basic rights that must attach to at least one class of shares of...
What are the basic rights that must attach to at least one class of shares of an incorporated company? Question 11 options: Limited liability, transfer of shares, receipt of dividends Voting rights for public offering, transfer of shares, ability to collect dividends annually Voting rights for election of directors, receipt of dividends, and share in the proceeds upon dissolution of the corporation
common stock A class of stock having first rights to dividends of a corporation preferred stock...
common stock A class of stock having first rights to dividends of a corporation preferred stock A class of stock that provides no preference rights to shareholders par value The account used to record the difference when issue price exceeds par value of stock Paid-In Capital in Excess of Par The number of shares sold to stockholders transfer agent A financial institution that records and maintains records of another company's stockholders. issued shares The dollar amount assigned to each share...
How do I work out the WACC The company’s preference shares are currently trading at $0.70...
How do I work out the WACC The company’s preference shares are currently trading at $0.70 each. The company’s ordinary shares are currently trading at $1.55 each. • The risk-free rate of return is 2.36 % p.a., and the return on the market is 8.50 % p.a. • Debentures have a coupon interest rate of 9% p.a. and could be re-issued at the present time at an interest rate of 7% p.a. The debentures will be redeemed at their face...
All of the following accurately describe preferred stock except: Carries a fixed dividend rate Receives preference...
All of the following accurately describe preferred stock except: Carries a fixed dividend rate Receives preference in distribution of dividends and/or distribution of assets upon liquidation Carries voting rights Is typically issued at par value Which of the following statements most accurately describes cumulative stock? A form of common stock in which the fixed dividend rate accumulates over time, if not paid A form of preferred stock in which the market value grows cumulatively, over time Any share of stock...
bonds are very popular means of financing long term investments in infrastructure. what advantages do they...
bonds are very popular means of financing long term investments in infrastructure. what advantages do they have over the sale of company shares?
What are sources of short-term financing? Check all that apply: Short-term bank loans Accounts receivable financing...
What are sources of short-term financing? Check all that apply: Short-term bank loans Accounts receivable financing Inventory financing Accounts payable Commercial paper
The typical rights of preferred shares usually include: Multiple Choice O a preference to a predesignated amount of dividends, that is a stated dollar amount per share or percent of per per share. O C ) the "preemptive right to maintain one's percentage share of ownership when new shares are issued O the night to vote O a preference over common shareholders and leaders in the distribution of assets in the event the corporation is dissolved o < Prey 28...
common stock A class of stock having first rights to dividends of a corporation preferred stock A class of stock that provides no preference rights to shareholders par value The account used to record the difference when issue price exceeds par value of stock Paid-In Capital in Excess of Par The number of shares sold to stockholders transfer agent A financial institution that records and maintains records of another company's stockholders. issued shares The dollar amount assigned to each share...
Most questions answered within 3 hours.
-
The Baily Corporation has developed a specialized software
program that improves inventory control capability. The following...
asked 1 minute ago -
Problem 5-4A (Part Level Submission) Wolford Department Store is
located in midtown Metropolis. During the past...
asked 1 minute ago -
Preparation of Benzoic Acid using a Grignard Reagent URGENT
1. During your Grignard formation, a small...
asked 24 minutes ago -
A uniform magnetic field is perpendicular to the plane of a wire
loop. If the loop...
asked 23 minutes ago -
At the peak of your career, your were earning $120,000 and
holding a top level position....
asked 27 minutes ago -
. A permanent magnet is dropped south-end-down through a horizontal
circular coil with a radius of...
asked 29 minutes ago -
Bernie's Beverages purchased some fixed assets classified as
5-year property for MACRS. The assets cost $28,000....
asked 43 minutes ago -
How many ATPs are produced from the catabolism of a 10-C
molecule of fatty acid under...
asked 47 minutes ago -
Before practicing a routine on the rings, a 64.8 kg gymnast
hangs motionless, with one hand...
asked 49 minutes ago -
If the K b of a weak base is 6.3 × 10 − 6 , what...
asked 55 minutes ago -
Which of the following is the minimum amount of moles of NaOH
that must be added...
asked 59 minutes ago -
Stories about organizational ________ provide important clues
about cultural values and norms.
a. myths
b. heroes...
asked 1 hour ago