Assume that the only capital market imperfection is taxes. Kay Industries currently has $ 125 million invested in short-term Treasury securities paying 6 % comma and it pays out the interest payments on these securities as a dividend. The board is considering selling the Treasury securities and paying out the proceeds as a one-time dividend payment. Assume that Kay must pay a corporate tax rate of 21 %, investors pay no taxes, and there is no taxable gain from the sale of the securities. a. If the board went ahead with this plan, what would happen to the value of Kay stock upon the announcement of a change in policy? b. What would happen to the value of Kay stock on the ex-dividend date of the one-time dividend? c. Given these price reactions, will this decision benefit investors? a. If the board went ahead with this plan, what would happen to the value of Kay stock upon the announcement of a change in policy? (Select the best choice below.) A. The value of Kay would remain the same. B. The value of Kay would fall by $ 125 million. C. The value of Kay would rise by $ 125 million. D. The value of Kay would rise by $ 125 million times 21 % equals $ 26 million.

During january 2018, the following transactions occur: january 1 purchase equipment for $20,600. the company estimates a residual value of $2,600 and a five-year service life. january 4 pay cash on accounts payable, $10,600. january 8 purchase additional inventory on account, $93,900. january 15 receive cash on accounts receivable, $23,100 january 19 pay cash for salaries, $30,900. january 28 pay cash for january utilities, $17,600. january 30 firework sales for january total $231,000. all of these sales are on account. the cost of the units sold is $120,500. the following information is available on january 31, 2018. depreciation on the equipment for the month of january is calculated using the straight-line method. the company estimates future uncollectible accounts. at the end of january, considering the total ending balance of the accounts receivable account as shown on the general ledger tab, $4,100 is now past due (older than 90 days), while the remainder of the balance is current (less than 90 days old). the company estimates that 50% of the past due balance will be uncollectible and only 3% of the current balance will become uncollectible. record the estimated bad debt expense. accrued interest revenue on notes receivable for january. unpaid salaries at the end of january are $33,700. accrued income taxes at the end of january are $10,100