Full question attached
Answer and Explanation:
1. Hearts R Us should account for the preferred shares series A financing as equity at issuance since it is not mandatory to redeem at issuance according to ASC 480-10-15-3
2. Here Hearts R Us may have to reclassify the preferred shares series A financing from Bionic considering no FDA approval yet and the failure of the heart valve product. Bionic has the option/right to redeem at par value in the fifth year if there is no FDA approval and so Hearts R Us would have to buy back the security from Bionic at par value(amount sold to Bionic) and classify as common stock.
Answer: accommodate changes in activity levels.
Explanation:
A flexible budget is refered to as the budget which changes based on the actual activity. It accommodate changes in activity levels.
It is the budget which is allowed to be adjusted as a result of the change in the assumptions that's used in the creation of the budget during the planning process of the management.
Answer:
10.4%
Explanation:
The formula to calculate the cost of equity is:
Cost of equity= (DPS/MPS)+r
DPS= Dividend per share
MPS= Market price per share
r= Growth rate of Dividends
Cost of equity= (2.77/40.12)+0.0350
Cost of equity=0.069+0.0350
Cost of equity=0.104→ 10.4%
The company's cost of equity if the current stock price is $40.12 per share is 10.4%.
Answer:
Hasalot has a near absolute advantage in Diamontite.
Explanation:
in this scenario, the best which describes the situation that Hasalot has a near absolute advantage in Diamontite.