What might lambert’s external auditors think

Reference no: EM131414360

1. a. Provide the journal entry to record the preferred stock issuance, and compute the resulting debt/equity ratio, assuming that the preferred stock is considered an equity security.

b. Compute the debt/equity ratio, assuming that the preferred stock is considered a debt security.

c. What incentives might the management of Lambert have to classify the issuance as equity instead of debt? Do you think that the issuance should be classified as debt or equity?
What might Lambert's external auditors think?

Reference no: EM131414360

Questions Cloud

Discuss apples stance on empowering workers areas : Discuss Apple's stance on each of the following areas: Empowering workers, Labor and Human Rights, Health and Safety, The Environment and Accountability.

What does the repurchase indicate about stock price trend : Were the shares to exercise the stock options issued at a higher or lower price than the shares issued for the sale of common stock? Explain how the two sets of shares could be issued for different purposes. What does the repurchase indicate about..

Explain how the article could have been improved : HU260:Describe how each of the Eight Intellectual Standards (clarity, accuracy, precision, relevance, depth, breadth, logic, and fairness) were used or not used in the article, supported by an example. If one of these standards does not apply to y..

What concept in assigned readings do you find most useful : What concept/idea in the assigned readings do you find most intriguing or useful? Why? How might you or others apply it? (the assigned reading "In Praise of Laziness"isonly for Q2)

What might lambert’s external auditors think : What incentives might the management of Lambert have to classify the issuance as equity instead of debt? Do you think that the issuance should be classified as debt or equity?What might Lambert's external auditors think?

What percentage of the high temperatures are within interval : What percentage of the high temperatures are within the interval.How do these percentages compare to the corresponding percentages for a normal distribution (68.26% and 95.44%, respectively)?Repeat Parts 2 to 6 for the minimum temperatures on your sp..

How large a stock dividend can the board legally declare : If the company sold its short-term investments, how large a cash dividend could it declare and pay? The current selling price of Oreton Corporation is $50 per share.

Discuss the constraints with respect to dividend payments : Discuss the constraints with respect to dividend payments that have been imposed on the board by the debt covenant and the appropriation.

Explain the tax deferral concepts and the impact on business : Explain the tax deferral concepts and the impact on the business, the employee, and potential tax consequences on both. Please be specific with your recommendations.

User Account

All Pages