Business, 08.11.2019 23:31, MansellS5529

7. debt irrelevance. digital fruit is financed solely by common stock and has outstanding 25 million shares with a market price of $10 a share. it now announces that it intends to issue $160 million of debt and to use the proceeds to buy back common stock. there are no taxes. (lo16-1) a. what is the expected market price of the common stock after the announcement? b. how many shares can the company buy back with the $160 million of new debt that it will issue? c. what is the market value of the firm (equity plus debt) after the change in capital structure? d. what is the debt ratio after the change in capital structure?

Answers: 2

Show answers

Other questions on the subject: Business

Business, 21.06.2019 20:30, moorega2100

Suppose the price of a complement to lcd televisions rises. what effect will this have on the market equilibrium for lcd tvs?

Answers: 1

continue

Business, 22.06.2019 19:40, silasjob09

The martinez legal firm (mlf) recently acquired a smaller competitor, miller and associates, which specializes in issues not previously covered by mlf, such as land use and intellectual property cases. given the increase in the firm's size and complexity, it is likely that its internal transaction costs willa. decrease. b. increase. c. become external transaction costs. d. be eliminated.

Answers: 3

continue

Business, 22.06.2019 20:00, bwelsh880

Ryngard corp's sales last year were $38,000, and its total assets were $16,000. what was its total assets turnover ratio (tato)? a. 2.04b. 2.14c. 2.26d. 2.38e. 2.49

Answers: 1

continue

Business, 22.06.2019 21:00, sofiaisabelaguozdpez

Roberto and reagan are both 25 percent owner/managers for bright light inc. roberto runs the retail store in sacramento, ca, and reagan runs the retail store in san francisco, ca. bright light inc. generated a $125,000 profit companywide made up of a $75,000 profit from the sacramento store, a ($25,000) loss from the san francisco store, and a combined $75,000 profit from the remaining stores. if bright light inc. is an s corporation, how much income will be allocated to roberto?

Answers: 2

continue

Do you know the correct answer?

7. debt irrelevance. digital fruit is financed solely by common stock and has outstanding 25 million...