Homework Answers
| Issue stock | Issue bond | |
| Income before interest and taxes | 720000 | 720000 |
| Interest expense | 0 | 192000 |
| Income before tax | 720000 | 528000 |
| Income tax expense | 288000 | 211200 |
| Net income | 432000 | 316800 |
| Outstanding shares | 720000 | 480000 |
| Earning per share | 0.60 | 0.66 |
Net income Higher if stock is used. however earning per share is lower than earning per share if bonds are used because of the additional shares of stock that are outstanding.
Add Answer to:
Ivanhoe Inc. is considering two alternatives to finance its construction of a new $2.40 million plant....
Sunland Inc. is considering two alternatives to finance its construction of a new $2.20 million plant (a) Issuance of 2...
Sunland Inc. is considering two alternatives to finance its construction of a new $2.20 million plant (a) Issuance of 220,000 shares of common stock at the market price of $10 per share. (b) Issuance of $2,200,000, 7% bonds at face value Complete the following table. (Round earnings per share to 2 decimal places, e.g. 0.25.) Issue Stock Issue Bond $650,000 $650,000 Income before interest and taxes Interest expense Income before income taxes Income tax expense (30%) Net income $ Outstanding...
Shamrock, Inc. is considering these two alternatives to finance its construction of a new $1.65 million...
Shamrock, Inc. is considering these two alternatives to finance
its construction of a new $1.65 million plant:
1.
Issuance of 165,000 shares of common stock at the market price
of $10 per share.
2.
Issuance of $1.65 million, 6% bonds at face value.
Complete the table. (Round earnings per share to 2
decimal places, e.g. $2.66.)
Issue Stock
Issue Bonds
Income before interest and taxes
$1,595,000
$1,595,000
Interest expense from bonds
enter a dollar amount
enter a dollar amount
Income...
Brief Exercise 11-13 (Part Level Submission) Marin Inc. is considering these two alternatives to finance its...
Brief Exercise 11-13 (Part Level Submission) Marin Inc. is considering these two alternatives to finance its construction of a new $1.20 million plant 1. 2. Issuance of 120,000 shares of common stock at the market price of $10 per share. Issuance of $1.20 million, 6% bonds at face value. (a) Complete the table. (Round earnings per share to 2 decimal places, eg. $2.66.) Issue Stock Issue Bonds Income before interest and taxes $1,656,000 $1,656,000 Interest expense from bonds Income before...
Brief Exercise 11-13 (Part Level Submission) Skysong, Inc. is considering these two alternatives to finance its...
Brief Exercise 11-13 (Part Level Submission) Skysong, Inc. is considering these two alternatives to finance its construction of a new $1.50 million plant: 1. 2. Issuance of 150,000 shares of common stock at the market price of $10 per share. Issuance of $1.50 million, 5% bonds at face value. (a) Complete the table. (Round earnings per share to 2 decimal places, e.g. $2.66.) Issue Stock Issue Bonds Income before interest and taxes $1,400,000 $1,400,000 Interest expense from bonds Income before...
See below. Last question options are "higher" or "lower". Brief Exercise 15-10 Sunland Inc. is considering...
See below. Last question options are "higher" or "lower".
Brief Exercise 15-10 Sunland Inc. is considering two alternatives to finance its construction of a new $1.50 million plant. (a) Issuance of 150,000 shares of common stock at the market price of $10 per share. (b) Issuance of $1,500,000, 7% bonds at face value. Complete the following table. (Round earnings per share to 2 decimal places, e.g. 0.25.) Issue Stock Issue Bond Income before interest and taxes $600,000 $600,000 Interest expense...
Brief Exercise 11-11 Shamrock, Inc.currently has 650,000 shares of common stock outstanding. Shamrock, Inc. is considering...
Brief Exercise 11-11 Shamrock, Inc.currently has 650,000 shares of common stock outstanding. Shamrock, Inc. is considering these two alternatives to finance its construction of a new $1.35 million plant: 1. 2. Issuance of 135,000 shares of common stock at the market price of $10 per share. Issuance of $1.35 million, 5% bonds at face value. Complete the table. (Round earnings per share to 2 decimal places, e.g. $2.66.) Issue Stock $1,550,000 Issue Bonds $1,550,000 Income before interest and taxes Interest...
Brief Exercise 11-11 Marin Inc. currently has 620,000 shares of common stock outstanding. Marin Inc. is...
Brief Exercise 11-11 Marin Inc. currently has 620,000 shares of common stock outstanding. Marin Inc. is considering these two alternatives to finance its construction of a new $1.20 milion pla 1. 2. Issuance of 120,000 shares of common stock at the market price of $10 per share. Issuance of $1.20 million, 8% bonds at face value. Complete the table. (Round earnings per share to 2 decimal places, e.g. $2.66.) Issue Stock $1,520,000 Issue Bonds $1,520,000 Income before interest and taxes...
Banks Company is considering two alternatives to finance its purchase of a new $3,000,000 office building....
Banks Company is considering two alternatives to finance its purchase of a new $3,000,000 office building. (a) Issue 300,000 shares of common stock at $10 per share. (b) Issue 8%, 10-year bonds at par ($3,000,000). Income before interest and taxes is expected to be $1,500,000. The company has a 30% tax rate and has 600,000 shares of common stock outstanding prior to the new financing. Instructions Calculate each of the following for each alternative: (1) Net income. (2) Earnings per...
Question 5 Larkspur, Inc.currently has 830,000 shares of common stock outstanding Larkspur, Inc. is considering these...
Question 5 Larkspur, Inc.currently has 830,000 shares of common stock outstanding Larkspur, Inc. is considering these two alternatives to finance its construction of a new$ 2.25 milion plant: 1 Issuance of 225,000shares of common stock at the market price of $ 10 per share. 2. issuance of $225 million,5% bondsatface value. Complete the table. (Round earnings per share to 2decimal places, eg. $2.66) Issue Stock Issue Bonds 1.730000 Income before interest and taxes Interest expense from bonds Income before income...
Penny Arcades, Inc., is trying to decide between the following two alternatives to finance its new...
Penny Arcades, Inc., is trying to decide between the following two alternatives to finance its new $16 million gaming center: a. Issue $16 million of 7% bonds at face amount. b. Issue 1 million shares of common stock for $16 per share. Required: 1. Assuming bonds or shares of stock are issued at the beginning of the year, complete the income statement for each alternative. (Enter your answer in dollars, not millions. (i.e., $5.5 million should be entered as 5,500,000)....
Sunland Inc. is considering two alternatives to finance its construction of a new $2.20 million plant (a) Issuance of 220,000 shares of common stock at the market price of $10 per share. (b) Issuance of $2,200,000, 7% bonds at face value Complete the following table. (Round earnings per share to 2 decimal places, e.g. 0.25.) Issue Stock Issue Bond $650,000 $650,000 Income before interest and taxes Interest expense Income before income taxes Income tax expense (30%) Net income $ Outstanding...
Shamrock, Inc. is considering these two alternatives to finance
its construction of a new $1.65 million plant:
1.
Issuance of 165,000 shares of common stock at the market price
of $10 per share.
2.
Issuance of $1.65 million, 6% bonds at face value.
Complete the table. (Round earnings per share to 2
decimal places, e.g. $2.66.)
Issue Stock
Issue Bonds
Income before interest and taxes
$1,595,000
$1,595,000
Interest expense from bonds
enter a dollar amount
enter a dollar amount
Income...
Brief Exercise 11-13 (Part Level Submission) Marin Inc. is considering these two alternatives to finance its construction of a new $1.20 million plant 1. 2. Issuance of 120,000 shares of common stock at the market price of $10 per share. Issuance of $1.20 million, 6% bonds at face value. (a) Complete the table. (Round earnings per share to 2 decimal places, eg. $2.66.) Issue Stock Issue Bonds Income before interest and taxes $1,656,000 $1,656,000 Interest expense from bonds Income before...
Brief Exercise 11-13 (Part Level Submission) Skysong, Inc. is considering these two alternatives to finance its construction of a new $1.50 million plant: 1. 2. Issuance of 150,000 shares of common stock at the market price of $10 per share. Issuance of $1.50 million, 5% bonds at face value. (a) Complete the table. (Round earnings per share to 2 decimal places, e.g. $2.66.) Issue Stock Issue Bonds Income before interest and taxes $1,400,000 $1,400,000 Interest expense from bonds Income before...
See below. Last question options are "higher" or "lower".
Brief Exercise 15-10 Sunland Inc. is considering two alternatives to finance its construction of a new $1.50 million plant. (a) Issuance of 150,000 shares of common stock at the market price of $10 per share. (b) Issuance of $1,500,000, 7% bonds at face value. Complete the following table. (Round earnings per share to 2 decimal places, e.g. 0.25.) Issue Stock Issue Bond Income before interest and taxes $600,000 $600,000 Interest expense...
Brief Exercise 11-11 Shamrock, Inc.currently has 650,000 shares of common stock outstanding. Shamrock, Inc. is considering these two alternatives to finance its construction of a new $1.35 million plant: 1. 2. Issuance of 135,000 shares of common stock at the market price of $10 per share. Issuance of $1.35 million, 5% bonds at face value. Complete the table. (Round earnings per share to 2 decimal places, e.g. $2.66.) Issue Stock $1,550,000 Issue Bonds $1,550,000 Income before interest and taxes Interest...
Brief Exercise 11-11 Marin Inc. currently has 620,000 shares of common stock outstanding. Marin Inc. is considering these two alternatives to finance its construction of a new $1.20 milion pla 1. 2. Issuance of 120,000 shares of common stock at the market price of $10 per share. Issuance of $1.20 million, 8% bonds at face value. Complete the table. (Round earnings per share to 2 decimal places, e.g. $2.66.) Issue Stock $1,520,000 Issue Bonds $1,520,000 Income before interest and taxes...
Question 5 Larkspur, Inc.currently has 830,000 shares of common stock outstanding Larkspur, Inc. is considering these two alternatives to finance its construction of a new$ 2.25 milion plant: 1 Issuance of 225,000shares of common stock at the market price of $ 10 per share. 2. issuance of $225 million,5% bondsatface value. Complete the table. (Round earnings per share to 2decimal places, eg. $2.66) Issue Stock Issue Bonds 1.730000 Income before interest and taxes Interest expense from bonds Income before income...
Penny Arcades, Inc., is trying to decide between the following two alternatives to finance its new $16 million gaming center: a. Issue $16 million of 7% bonds at face amount. b. Issue 1 million shares of common stock for $16 per share. Required: 1. Assuming bonds or shares of stock are issued at the beginning of the year, complete the income statement for each alternative. (Enter your answer in dollars, not millions. (i.e., $5.5 million should be entered as 5,500,000)....
Most questions answered within 3 hours.
-
3. Gains from trade
Consider two neighbouring island countries called Euphoria and
Contente. They each have...
asked 35 minutes ago -
A business executive has the option to invest money in two
plans: Plan A guarantees that...
asked 2 hours ago -
Hello, can someone please help me answer this question?
How much heat is absorbed by a...
asked 2 hours ago -
. A marketing researcher conducted a survey of 25 shoppers
randomly selected at the local mall...
asked 3 hours ago -
Create an comprehensive response to the
following:
Antimicrobial agents work on a multitude of microbes (bacteria,...
asked 3 hours ago -
6.13 LAB: Step counter. Section 6.3.
A pedometer treats walking 2,000 steps as walking 1 mile....
asked 3 hours ago -
(14.2) A block of mass m = 10 kg riding on a frictionless
horizontal plane is...
asked 3 hours ago -
Use any search engine to search for articles about Starbucks
partnership with Tata Companies in India...
asked 3 hours ago -
Let’s say that for some reason Bank Excess Reserves suddenly
increase sharply. What effect would this...
asked 3 hours ago -
Given:
Curent Assets: $600,000
Total Assets: $2,600,000
Current Liabilities: $500,000
Total Liabilities: $1,700,000
What is the...
asked 3 hours ago -
1. What is a “Bankster”? What is insider trading? Why is it
illegal?
2. What is...
asked 3 hours ago -
A transverse wave on a cord is given by
D(x,t)=0.18sin(2.7x−61.0t), where Dand x are in m...
asked 3 hours ago