Find the number of new common stock issue

Reference no: EM1347792

Taggart Technologies is considering issuing new common stock and using the proceeds to reduce its outstanding debt. The stock issue would have no effect on total assets, the interest rate Taggart pays, EBIT, or the tax rate. Which of the following is likely to occur if the company goes ahead with the stock issue?:

-The ROA will decline.

-Taxable income will decrease.

-The tax bill will increase.

-Net income will decrease.

-The times interest earned ratio will decrease.

Reference no: EM1347792

Questions Cloud

Banker must be satisfied : Before approving a loan to a small business, banker must be satisfied with the owner's character. Why is this? Do you agree or disagree? Explain your answer.

Find out the width of the slit : Two point charges q1 = 3.40 nC and q2 = -5.50 nC are 0.100m apart. Point A is midway between them; point B is 0.080 m from q1 and 0.060 m from q2. Take an electric potential to be zero at infinity.

Rewarding production department employees : A company rewards its production department employees for meeting budgeted cost levels by giving out bonuses. If department's cost exceeds the budget, employees don't get a bonus. What problems may arise with such a plan?

Explaining statement for security policy : Write a statement for security policy for the following:Let LAN for small 100-person business, Pixel Inc. Business occupies one floor in office building. Everybody has a computer on his or her desk.

Find the number of new common stock issue : Taggart Technologies is planning issuing new common stock and using proceeds to decrease its outstanding debt. The stock issue would have no effect on assets.

Illustrate is there a nash equilibrium : I hereby offer you $5,001 if both you and my other creditor agree to cancel my debt. If either or both of you decline this offer, I will be legally in default and you will receive $5,000." So, what happens.

Static budget versus flexible budget : Why do you think companies make mistake of only paying close attention to the static budget? Is it just not wanting to spend the time and money?

Important forecast of master budget : A master budget is the compilation of forecasts for coming year or operating cycle made of many departments or function in an organization. What is the most significant forecast made in the master budget? Mention the reasons for your answer.

How does a firm determine its demand for capital funds : Explain how does a firm determine its prices also the quantity of labor need in the resource market during a specific period. How does a firm determine its demand for capital funds during a specific period.

User Account

All Pages