PLEASE USE MEMO TEMPLET
The purpose of this assignment is to analyze stockholders’
equity to recommend strategies for generating cash. Understanding a company’s
position as it relates to stockholders and stockholders’ equity is important
when considering options and making decisions related to the strategies that
should be implemented to generate cash for the company.
The chief executive officer (CFO) of the company wants to
generate cash for the organization and has tasked you to review the current
stockholders’ equity position for the company and use your findings to
recommend strategies for generating cash flow. The CEO has requested you
summarize your findings in a memo that is addressed to the CFO, but one that
could be shared with other stakeholders. To access a memo template, refer to
“Effective Business Writing,” located in the Class Resources. In the
“Effective Business Writing” section on the Student Success Center,
you will find a “Templates” section with a “Memo Template”
you may download and utilize for this assignment.
Refer to the “Annual Reports for Approved Companies” and
access the Form 10-K for one of the companies. Review and study the following
information related to stocks:
Identify and discuss the current types of stock, such
as common or preferred stock, currently issued, and outstanding. Include a
narrative description along with the values and number of shares found on
the balance sheet.
Identify the presence of treasury stock and its
impact on overall stockholders’ equity. If the company does not have
treasury stock, indicate the absence of treasury stock and provide some
discussion as to why the company may not have purchased back any of its
originally issued stock.
Review the notes to the financial statements to
determine if the company has any convertible bonds and summarize the
characteristics of those bonds. If there are no convertible bonds in the
notes, discuss why a company may want to consider convertible bonds in the
future.
Discuss the pros and cons of issuing new stock,
reissuing treasury stock (if applicable), and issuing convertible bonds.
In addition, include your recommendations on how the
company could generate cash from issuing new common stock, preferred
stock, convertible bonds or reissuing treasury stock. Support your
recommendations with examples that show the impact on cash.
General Requirements:
Using the five items above as a guide, summarize your
findings and recommendations for the CFO.
Submit the Word memo document to the dropbox. with the
naming convention LastnameFirstinitial.T6memo.
This assignment uses a rubric. Please review the rubric
prior to beginning the assignment to become familiar with the expectations for
successful completion.
