Consider the following potential events that might have occurredto Global on Decemberâ 30, 2016. For eachâ one, indicate which lineitems inâ Global's balance sheet would be affected and by how much.Also indicate the change toâ Global's book value of equity.
a. Global used $ 20.6 million of its available cash to repay $20.6 million of itsâ long-term debt.
b. A warehouse fire destroyed $ 4.7million worth of uninsuredinventory.
c. Global used $ 5.3 million in cash and $ 5.1 million in newâlong-term debt to purchase a $ 10.4 million building.
d. A large customer owing $2.9 million for products it alreadyreceived declaredâ bankruptcy, leaving no possibility that Globalwould ever receive payment.
e. âGlobal's engineers discover a new manufacturing process thatwill cut the cost of its flagship product by more than 53 %
f. A key competitor announces a radical new pricing policy thatwill drastically undercutâ Global's prices.
Consider the following potential events that might have occurredto Global on Decemberâ 30, 2016. For eachâ one, indicate which lineitems inâ Global's balance sheet would be affected and by how much.Also indicate the change toâ Global's book value of equity.
a. Global used $ 20.6 million of its available cash to repay $20.6 million of itsâ long-term debt.
b. A warehouse fire destroyed $ 4.7million worth of uninsuredinventory.
c. Global used $ 5.3 million in cash and $ 5.1 million in newâlong-term debt to purchase a $ 10.4 million building.
d. A large customer owing $2.9 million for products it alreadyreceived declaredâ bankruptcy, leaving no possibility that Globalwould ever receive payment.
e. âGlobal's engineers discover a new manufacturing process thatwill cut the cost of its flagship product by more than 53 %
f. A key competitor announces a radical new pricing policy thatwill drastically undercutâ Global's prices.
