Ivanhoe Company has $1,200,000 in assets and $1,200,000 in stockholders’ equity, with 42,200 shares outstanding the entire year. It has a return on assets of 10%. During 2021, it had net income of $120,000. On January 1, 2022, it issued $386,000 in debt at 6% and immediately repurchased 21,100 shares for $386,000. Management expected that, had it not issued the debt, it would have had net income of $120,000 in 2022. Assume the company pays dividends on common stock equal to its net income each year. Also, assume the accrued interest on the debt was paid at December 31, 2022 and the company has no other debt outstanding at year-end.
Homework Answers
| 2021 | 2022 | |
| Net Income | 120000 | 96840 |
| Number of shares | 42200 | 21100 |
| Equity | 1200000 | 600000 |
| EPS | 2.843601896 | 4.58957346 |
| Return on Equity | 10.00% | 16.14% |
| Debt to Assets Ratio | 0 | 32.167% |
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Ivanhoe Company has $1,200,000 in assets and $1,200,000 in
stockholders’ equity, with 42,200 shares outstanding the...
Ivanhoe Company has $1,200,000 in assets and $1,200,000 in stockholders equity, with 42,200 shares outstanding the...
Ivanhoe Company has $1,200,000 in assets and $1,200,000 in
stockholders equity, with 42,200 shares outstanding the entire
year. It has a return on assets of 10%. During 2016, I had net
income of $120,000. On January 1, 2017, it issued $386,000 in debt
at 6% and immediately re-purchased 21,100 shares for $386,000.
Management expected that, had it not issued the debt, it would have
had net income of $120,000 in 2017.
Exercise 11-15 Ivanhoe Company has $1,200,000 in assets and...
Exercise 11-20 a-c Crane Company has $1,140,000 in assets and $1,140,000 in stockholders’ equity, with 36,600...
Exercise 11-20 a-c
Crane Company has $1,140,000 in assets and $1,140,000 in
stockholders’ equity, with 36,600 shares outstanding the entire
year. It has a return on assets of 15%. During 2021, it had net
income of $171,000. On January 1, 2022, it issued $397,000 in debt
at 6% and immediately repurchased 18,300 shares for $397,000.
Management expected that, had it not issued the debt, it would have
had net income of $171,000 in 2022.
Determine the company’s net income and...
Crane Company has $1,140,000 in assets and $1,140,000 in stockholders’ equity, with 36,600 shares outstanding the...
Crane Company has $1,140,000 in assets and $1,140,000 in
stockholders’ equity, with 36,600 shares outstanding the entire
year. It has a return on assets of 15%. During 2021, it had net
income of $171,000. On January 1, 2022, it issued $397,000 in debt
at 6% and immediately repurchased 18,300 shares for $397,000.
Management expected that, had it not issued the debt, it would have
had net income of $171,000 in 2022.
Determine the company's net income and earnings per share...
Crane Company has $1,020,000 in assets and $1,020,000 in stockholders’ equity, with 39,000 shares outstanding the...
Crane Company has $1,020,000 in assets and $1,020,000 in stockholders’ equity, with 39,000 shares outstanding the entire year. It has a return on assets of 10%. During 2021, it had net income of $102,000. On January 1, 2022, it issued $370,000 in debt at 6% and immediately repurchased 19,500 shares for $370,000. Management expected that, had it not issued the debt, it would have had net income of $102,000 in 2022. Assume the company pays dividends on common stock equal...
Oriole Company has $1,110,000 in assets and $1,110,000 in stockholders' equity, with 43,600 share...
Oriole Company has $1,110,000 in assets and $1,110,000 in stockholders' equity, with 43,600 shares outstanding the entire year. It has a return on assets of 10%. During 2016, it had net income of $111,000. On January 1, 2017, it issued $409,000 in debt at 4% and immediately repurchased 21,800 shares for $409,000. Management expected that, had it not issued the debt, it would have had net income of $111,000 in 2017. Determine the company's net income and earnings per share...
Cabo Company has $1,000,000 in assets and $1,000,000 in stockholders’ equity, with 40,000 shares outstanding the...
Cabo Company has $1,000,000 in assets and $1,000,000 in
stockholders’ equity, with 40,000 shares outstanding the entire
year. It has a return on assets of 10%. During 2016, it had net
income of $100,000. On January 1, 2017, it issued $400,000 in debt
at 4% and immediately repurchased 20,000 shares for $400,000.
Management expected that, had it not issued the debt, it would have
had net income of $100,000 in 2017.
Determine the company’s net income and earnings per share...
Ivanhoe Company Balance Sheets December 31 Assets Cash Receivables (net) Other current assets Long-term investments Property,...
Ivanhoe Company Balance Sheets December 31 Assets Cash Receivables (net) Other current assets Long-term investments Property, plant, and equipment (net) Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and stockholders' equity 2022 $ 26,400 80,000 84,850 62,600 570,000 $ 823,850 2021 $ 19,400 56,000 76,400 59,800 480,000 691,600 $ 76,500 76,000 332,000 339,350 $ 823,850 $ 69,000 96,000 310,000 216,600 $ 691,600 Ivanhoe Company Income Statements For the Years Ended December 31...
The stockholders’ equity accounts of Novak Corp. on January 1, 2017, were as follows. Preferred Stock...
The stockholders’ equity accounts of Novak Corp. on January 1, 2017, were as follows. Preferred Stock (6%, $100 par noncumulative, 5,000 shares authorized) $300,000 Common Stock ($4 stated value, 300,000 shares authorized) 1,000,000 Paid-in Capital in Excess of Par Value—Preferred Stock 15,000 Paid-in Capital in Excess of Stated Value—Common Stock 480,000 Retained Earnings 692,000 Treasury Stock (5,000 common shares) 40,000 During 2017, the corporation had the following transactions and events pertaining to its stockholders’ equity. Feb. 1 Issued 5,000 shares...
The following information is available for Bridgeport Corp. Current assets Total assets Current liabilities Total liabilities...
The following information is available for Bridgeport Corp. Current assets Total assets Current liabilities Total liabilities Net income Net cash provided by operating activities Preferred dividends Common dividends Expenditures on property, plant, and equipment 2022 $ 59,690 242,500 23,500 58,200 82,400 92,400 7,525 5,400 29.400 2021 $ 45,360 207,400 32,400 72,590 46,795 58,400 7,525 3.900 14,400 Common shares outstanding at beginning of year Common shares outstanding at end of year 42,400 77.400 32.400 42.400 (a) Compute earnings per share for...
The Imaginary Products Co. currently has debt with a market value of $275 million outstanding. The...
The Imaginary Products Co. currently has debt with a market value of $275 million outstanding. The debt consists of 9 percent coupon bonds (semiannual coupon payments) which have a maturity of 15 years and are currently priced at $1,181.85 per bond. The firm also has an issue of 2 million preferred shares outstanding with a market price of $12. The preferred shares pay an annual dividend of $1.20. Imaginary also has 14 million shares of common stock outstanding with a...
Ivanhoe Company has $1,200,000 in assets and $1,200,000 in
stockholders equity, with 42,200 shares outstanding the entire
year. It has a return on assets of 10%. During 2016, I had net
income of $120,000. On January 1, 2017, it issued $386,000 in debt
at 6% and immediately re-purchased 21,100 shares for $386,000.
Management expected that, had it not issued the debt, it would have
had net income of $120,000 in 2017.
Exercise 11-15 Ivanhoe Company has $1,200,000 in assets and...
Exercise 11-20 a-c
Crane Company has $1,140,000 in assets and $1,140,000 in
stockholders’ equity, with 36,600 shares outstanding the entire
year. It has a return on assets of 15%. During 2021, it had net
income of $171,000. On January 1, 2022, it issued $397,000 in debt
at 6% and immediately repurchased 18,300 shares for $397,000.
Management expected that, had it not issued the debt, it would have
had net income of $171,000 in 2022.
Determine the company’s net income and...
Crane Company has $1,140,000 in assets and $1,140,000 in
stockholders’ equity, with 36,600 shares outstanding the entire
year. It has a return on assets of 15%. During 2021, it had net
income of $171,000. On January 1, 2022, it issued $397,000 in debt
at 6% and immediately repurchased 18,300 shares for $397,000.
Management expected that, had it not issued the debt, it would have
had net income of $171,000 in 2022.
Determine the company's net income and earnings per share...
Oriole Company has $1,110,000 in assets and $1,110,000 in stockholders' equity, with 43,600 shares outstanding the entire year. It has a return on assets of 10%. During 2016, it had net income of $111,000. On January 1, 2017, it issued $409,000 in debt at 4% and immediately repurchased 21,800 shares for $409,000. Management expected that, had it not issued the debt, it would have had net income of $111,000 in 2017. Determine the company's net income and earnings per share...
Cabo Company has $1,000,000 in assets and $1,000,000 in
stockholders’ equity, with 40,000 shares outstanding the entire
year. It has a return on assets of 10%. During 2016, it had net
income of $100,000. On January 1, 2017, it issued $400,000 in debt
at 4% and immediately repurchased 20,000 shares for $400,000.
Management expected that, had it not issued the debt, it would have
had net income of $100,000 in 2017.
Determine the company’s net income and earnings per share...
Ivanhoe Company Balance Sheets December 31 Assets Cash Receivables (net) Other current assets Long-term investments Property, plant, and equipment (net) Total assets Liabilities and Stockholders' Equity Current liabilities Long-term liabilities Common stock Retained earnings Total liabilities and stockholders' equity 2022 $ 26,400 80,000 84,850 62,600 570,000 $ 823,850 2021 $ 19,400 56,000 76,400 59,800 480,000 691,600 $ 76,500 76,000 332,000 339,350 $ 823,850 $ 69,000 96,000 310,000 216,600 $ 691,600 Ivanhoe Company Income Statements For the Years Ended December 31...
The following information is available for Bridgeport Corp. Current assets Total assets Current liabilities Total liabilities Net income Net cash provided by operating activities Preferred dividends Common dividends Expenditures on property, plant, and equipment 2022 $ 59,690 242,500 23,500 58,200 82,400 92,400 7,525 5,400 29.400 2021 $ 45,360 207,400 32,400 72,590 46,795 58,400 7,525 3.900 14,400 Common shares outstanding at beginning of year Common shares outstanding at end of year 42,400 77.400 32.400 42.400 (a) Compute earnings per share for...
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