available-to-sell stock versus a held-to-maturity stock

Q: Which of the following is not a very common feature of preferred stock? a. Voting rights b.The…

A: One of the sources of raising the funds and meeting the financial requirements is to issue the…

Q: Describe howcompensation expense is determined and recorded for a restricted stock award plan

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Q: Why might an investor-owned firm choose to issue different classes of common stock?

A: An investor owned firm issues different classes of common stock mainly due to the difference in…

Q: Which of the following is/are incorrect about the characteristics of preferred stock I.It has a…

A: Preferred stock : They are shares of a company's stock with dividend that are paid out to…

Q: own stock that they have previously issued?’

A: company wants to repurchase some of its own stock that they have previously issued because of…

Q: true or false.e. Issuing no-par value stock with a stated value is fundamentally different from…

A: Par value: It refers to the value of a stock that is stated by the corporation’s charter. It is also…

Q: Discuss why options and warrants may be considered potentially dilutive common shares for the…

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Q: A. Explain why a firm might consider a stock split for its shares.

A: “Since you have asked multiple question, we will solve the first question for you. If you want any…

Q: According to our authors, when is the purchase of stock in one company by another classified as a…

A: Trading security- Classification of securities- There are three different classification: a) held…

Q: Which of the following is false? a.   Under GAAP, companies cannot record gains on transactions…

A: Common stock: These are the ordinary shares that a corporation issues to the investors in order to…

Q: When treasury stock is purchased for more than the par value of the stock and the cost method is…

A: Treasury stock means where the own stock has been repurchased by company from open market and can be…

Q: Which of the following methods should be used to account for the conversion of preferred stock to…

A: Common stock and preferred stock are two types of shares issued by a company. Preferred stock is…

Q: Which of the following is not a defining feature of common stock? a residual claim on assets voting…

A: Common stock: The common stock is considered as a security that signifies proprietorship in a…

Q: hy would a company choose to not pay dividends on its common stock?

A: Dividends are the return earned by the shareholders in lieu of the amount invested in company's…

Q: Which of the following is not associated with characteristics of common stock? O residual claim on…

A: A common stock is a sort of stock that is issued to the majority of the shareholders of a…

Q: Explain the significance of par value. Does par value indicatethe reasonable market price for a…

A: Significance Of Par value: *Par value is the face value of the shares, the principal amount investor…

Q: Why do companies reacquire their own shares of stock?

A: Ans. For many reasons companies reacquire their own shares of stock. Some of them are discussed…

Q: What are the pros and cons of a company’s decision to issue stock versus issuing bonds?

A: Bonds: Bonds are long-term promissory notes that are represented by a company while borrowing money…

Q: How are shares issued at full market value treated differently from rights issues? Explain why it…

A: Destitute organizations will move to rights problems to fund-raise once they actually would like it.…

Q: How is the accounting for a purchase of a company’s own stock (treasury stock) different from the…

A: A company’s stock is the shares a company holds or the shares on which a company has its ownership…

Q: Explain how convertible securities are determined to bepotentially dilutive common shares and how…

A:

Q: Which of the following is not true for Book Value of a share? * It depends on the balance sheet…

A: Book value of share: The book value is calculated on the basis of the book value of assets and…

Q: What does it indicate when there are outstanding units of stock

A: Share of a Stock are outstanding implies that the specified number of share of the stock have been…

Q: Stock appreciation right would normally be settled through

A: Second option is wrong because stock appreciation right is not settled through issue of share…

Q: stock markets protect a firms shares from liquidity? true or false

A: Stock markets are said to be amongst the foremost vital components of a free-market economy where…

Q: The par value of a stock is legally significant.

A: Solution: The par value of a stock "is legally significant".

Q: The prescribed accounting treatment for stock dividends implicitly assumes that shareholders are…

A: Stock Dividends: It refers to the payment of dividends by a company to its existing shareholders, in…

Q: What is treasury stock? Why would a company repurchase its own stock? How might they dispose of the…

A: Stockholders’ equity is the measure of assets staying in a business after the sum total of the…

Q: A preferred stock has a fixed dividend and a priority status over other equity securities? Select…

A: As the name suggests, preferred stock owners have higher claims as compared to common stock holders.

Q: According to the signaling theory, issuing common stock is negatively perceived. Is this true or…

A: Signaling theory focuses on how issue of debt and equity are perceived by the investors and how…

Q: why should a company invest in the stock of another company?

A: When a company invests in the stock of another company, it is known as Inter-corporate investments.

Q: Under what circumstances is the equity method used to account for an investment in stock?

A:

Q: What is restricted stock? How do restricted stock awards differ from restricted stock units (RSUs)?…

A: Restricted Stock: Restricted stock is the portion of shares held up by the management, to be issued…

Q: The company must issue a new stock if the market value is less than intrinsic value, otherwise there…

A: While both are forms of valuing a firm, there is a major difference between intrinsic value and…

Q: How do restricted stock awards differ from restricted stock units (RSUs)?

A: Restricted stock: Restricted stock is the portion of shares held up by the management, to be issued…

Q: The treasury stock method is used to incorporate the dilutive effect of stock options, stock…

A: Diluted EPS( Earning per share) means potential increase in the no of shares and thereby decreasing…

Q: Explain how a repurchase changes the number of shares but notthe stock price.

A: The repurchase of stock decreases the number of existing shares, making each worth a higher…

Q: In your opinion, should a public listed company pay attention to the market price of its common…

A: Market prices are decided by the demand and supply(D/S) of the security and investors perception…

Q: If stock options and restricted stock are outstanding when calculating diluted EPS, what are the…

A: Earnings per share (EPS): The amount of net income available to each shareholder per common share…

Q: why a specific company would purchase the stock of another and provide an example

A: The stock values of the two companies typically move in predictable opposing directions after an…

Q: Which of the following is not a method that may be used to account for treasury shares? a. Cost…

A: The treasury shares are the shares which are reacquired by the issuing company from the…

Q: circumstance the Dividend Discount Model (DDM) cannot be used to determine the price of a stock

A: Dividend discount model It is generally utilized by investors for the measurement of the value of…

Q: What is stock split? Distinguish between a bonus issue and a stock split.

A: Stock Split Means: it refers to that a company divides its existing share into multiple shares or a…

Q: Who are the major purchasers of nonconvertible preferred stock? Why?

A: Mostly, the buyers of preferred stocks are institutional investors because they get an incentive…