Fcoj, inc., a prominent consumer products firm, is debating whether to convert its all-equity capital structure to one that is 20 percent debt. currently, there are 17,000 shares outstanding, and the price per share is $47. ebit is expected to remain at $39,100 per year forever. the interest rate on new debt is 6.5 percent, and there are no taxes.

a. allison, a shareholder of the firm, owns 150 shares of stock. what is her cash flow under the current capital structure, assuming the firm has a dividend payout rate of 100 percent?
b. what will allison’s cash flow be under the proposed capital structure of the firm? assume she keeps all 150 of her shares.
c. assume that allison unlevers her shares and re-creates the original capital structure. what is her cash flow now?

Torino company has 1,300 shares of $50 par value, 6.0% cumulative and nonparticipating preferred stock and 13,000 shares of $10 par value common stock outstanding. the company paid total cash dividends of $3,500 in its first year of operation. the cash dividend that must be paid to preferred stockholders in the second year before any dividend is paid to common stockholders is:

Cynthia is a hospitality worker in the lodging industry who prefers to cater to small groups of people. she might want to open a

Trecek corporation incurs research and development costs of $625,000 in 2017, 30 percent of which relate to development activities subsequent to ias 38 criteria having been met that indicate an intangible asset has been created. the newly developed product is brought to market in january 2018 and is expected to generate sales revenue for 10 years. assume that a u.s.–based company is issuing securities to foreign investors who require financial statements prepared in accordance with ifrs. thus, adjustments to convert from u.s. gaap to ifrs must be made. ignore income taxes. required: (a) prepare journal entries for research and development costs for the years ending december 31, 2017, and december 31, 2018, under (1) u.s. gaap and (2) ifrs. (c) prepare the entry(ies) that trecek would make on the december 31, 2017, and december 31, 2018, conversion worksheets to convert u.s. gaap balances to ifrs.