The management of Corporation A forms Corporation B in which the management owns some of the stock. Using the assets of Corporation A as security, bonds are issued and the public shareholders of Corporation A are eliminated. This action by management is best described as a ________
a. leveraged buyout
b. short-form merger
c. cash-out combination
d. compulsory share exchange
a
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At the arraignment proceeding, the accused may plead:
A) Guilty. B) Not-guilty. C) Nolo-contendere. D) All of the above.
The derivative of a function equals the slope of the curve defined by that function
Indicate whether this statement is true or false.
Consider the data on Inventory of Widgets Over a 10-Day Period. Any time that ending inventory falls to 15 or below, an order is placed for 20 units of the product. The lead time for delivery varies and is shown in the column under Lead Time. If the cost of placing an order is $8, what are the total ordering costs during the 10-day period?
a. $3
b. $42
c. $8
d. $24
The MAX Corporation is planning a $4,000,000 expansion this year. The expansion can be financed by issuing
either common stock or bonds. The new common stock can be sold for $60 per share. The bonds can be issued with a 12 percent coupon rate. The firm's existing shares of preferred stock pay dividends of $2.00 per share. The company's corporate income tax rate is 46 percent. The company's balance sheet prior to expansion is as follows: MAX Corporation Current Assets $2,000,000 Fixed Assets 8,000,000 Total Assets $10,000,000 Current Liabilities $1,500,000 Bonds: (8%, $1,000 par value) 1,000,000 (10%, $1,000 par value) 4,000,000 Preferred Stock: ($100 par value) $500,000 Common Stock: ($2 par value) 700,000 Retained Earnings 2,300,000 Total Liabilities and Equity $10,000,000 a. Calculate the indifference level of EBIT between the two plans. b. If EBIT is expected to be $3 million, which plan will result in higher EPS?