A firm has an outstanding issue of 1,000 shares of preferred stock with a $100 par value and an 8 percent annual dividend. The firm also has 5,000 shares of common stock outstanding. If the stock is cumulative and the board of directors has not paid the preferred dividend for the prior two years, how much must the preferred stockholders be paid (in total, not per share) prior to paying dividends to common stockholders at the end of third year?

Classifying inflows and outflows of cash classify each of the following items as an inflow (i) or an outflow (o) of cash, or as neither (n). lg 2 lg 2 item change ($) item change ($) cash +100 accounts receivable −700 accounts payable −1,000 net profits +600 notes payable +500 depreciation +100 long-term debt −2,000 repurchase of stock +600 inventory +200 cash dividends +800 fixed assets +400 sale of stock +1,000

The common stock and debt of northern sludge are valued at $65 million and $35 million, respectively. investors currently require a return of 15.9% on the common stock and a return of 7.8% on the debt. if northern sludge issues an additional $14 million of common stock and uses this money to retire debt, what happens to the expected return on the stock? assume that the change in capital structure does not affect the interest rate on northern’s debt and that there are no taxes.

What role do business cycles play in a market economy