What important assumption underlies potential profit

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Reference no: EM131915816

1. The stock of BFD Inc is selling for $5. Its assets have a book value of $12 and it has liabilities of $5 (both per share). What is BFD's market to book ratio? Show how you could breakup this company and make a profit? What important assumption underlies this potential profit?

2. PDQ Inc., a highly levered firm, recently switched to accelerated depreciation. This move didnt increase their net income or their stock price, however. Why not? Be precise.

Reference no: EM131915816

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