Question
Your company's summarized financial information for the beginning and projected end of the current year is as follows: Beginning of the Year End of the
Your company's summarized financial information for the beginning and projected end of the current year is as follows: Beginning of the Year End of the Year (projected) Assets $90,000 $100,000 Liabilities 30,000 30,000 Equity 60,000 70,000 Net Income 15,000 Your company is considering issuing 30 bonds at the end of the year (December 31st). The bonds will pay 8% interest semi-annually for 10 years and the market rate for similar bonds is 5%. Therefore, the total bond proceeds are $37,015.12. Calculate the following ratios with and without the bond issue. Review question: how much did the company pay in dividends this year (if any)? The company did not issue or repurchase any stock during the year.
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