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Please use the balance sheet below to answer the following six (6) questions: Scenario #1 ABC is a small business that is owned by one
Please use the balance sheet below to answer the following six (6) questions: Scenario #1 ABC is a small business that is owned by one owner (Owner #1) who owns 100% of the 10,000 shares of outstanding no par common stock. ABC is seeking additional funds to expand their business. Another investor (Owner #2) is willing to invest $100,000 in their business. The offer includes $75,000 cash in exchange for the issuance of 5,000 new shares of common stock and the remaining $25,000 cash would be lent to ABC in the form of a 5 year loan. Balance Sheet before the Owner #2's investment: Balance Sheet ABC Company December 31, 20xx Current Assets Current Assets Cash Accounts Receivable Inventory 20 85 60 165 Total Assets Liabilities Accounts Payable Notes Payable 10 15 15 Total Liabilities Stockholders' Equity Common Stock Retained Earning 50 100 150, Total Liabilities and Stockholders' Equity 165 Total Stockholders' Equity
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