Attachment # 00000716 - 4_part3_0.docx
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(refer to the detailed question and attachment below)
JumpinJehosaPhats was incorporated on January 1, 2012 and a year later it needs $10,000,000 to expand operations. JJ Phats is the sole shareholder of the corporation.The corporation is considering three methods to raise the capital: issuing common shares at FMVissuing preferred stock with par = $1000issuing 10 year bonds with par = $1000You have been hired to determine the best way for the company to obtain the funds needed which might be a single method or combination of methods. Using the following information, discuss the pros and cons of each method and provide necessary calculations to support the position you recommend.The company is authorized to issue 1,000,000 shares with a par value of $1.00On January 1, 2013 an appraisal of the company indicates that it has a current value of $25,000,000. On January 1, 2013 current interest rates are 3.5% APR and rising.On December 1, 2012 the competition (LeapinLizards Inc) issued 10,000 ten year cumulative preferred shares with par = $1000 at 3.4%
Accounting - Corporations

Accounting - Corporations

Question # 00004685 Posted By: paul911 Updated on: 12/05/2013 12:44 PM Due on: 12/06/2013
Subject Accounting Topic Accounting Tutorials:
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A set of scenarios where you will perform various funtions regarding incorporation and statement of cash flows. Use the attached files. (4th Part has 2 worksheets)
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Attachments
4_part1directions_0.docx (25 KB)
4_part2_0.docx (26.22 KB)
4_part3_0.docx (27.88 KB)
4_part4_0.xlsx (19.42 KB)
Tutorials for this Question
  1. mac123
    Tutorial # 00004484 Posted By: mac123 Posted on: 12/05/2013 12:45 PM
    Puchased By: 7
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    The solution of Accounting - Corporations...
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    Attachments
    4_part2_0_1_sol_0.docx (26.74 KB)
    4_part3_0_2_sol.docx (28.58 KB)
    4_part4_0_1_sol_0.xlsx (18.82 KB)
    part_1.doc (28.5 KB)
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