Questions from Financial Accounting


Q: Why is the EPS number so popular? What are its limitations

Why is the EPS number so popular? What are its limitations?

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Q: How do stock repurchases affect the EPS and ROE ratios?

How do stock repurchases affect the EPS and ROE ratios?

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Q: Briefly define what an ethical dilemma is and describe the steps to

Briefly define what an ethical dilemma is and describe the steps to consider when evaluating ethical dilemmas.

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Q: What is one interpretation of a high P/E ratio?

What is one interpretation of a high P/E ratio?

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Q: What are the relative advantages of equity versus debt financing?

What are the relative advantages of equity versus debt financing?

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Q: You work for a public company that has relied heavily on debt

You work for a public company that has relied heavily on debt financing in the past and is now considering a preferred stock issuance to reduce its debt-to-assets ratio. Debtto-assets is one of the ke...

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Q: Just prior to filing for bankruptcy protection in 2009, General Motors

Just prior to filing for bankruptcy protection in 2009, General Motors asked its bondholders to exchange their investment in GM’s bonds for GM stock. The bondholders rejected this proposal. Why might...

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Q: Explain each of the following terms: (a) authorized common

Explain each of the following terms: (a) authorized common stock, (b) issued common stock, and (c) outstanding common stock.

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Q: What are the differences between common stock and preferred stock?

What are the differences between common stock and preferred stock?

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Q: What is the distinction between par value and no-par value

What is the distinction between par value and no-par value capital stock?

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