Financial Statement

Financial Statement

Question 1

Evaluation of the Issuance of Common Stock

Evaluation of the common stock can be done in by making use of PE ratio. This ratio gives the investors a tool for the measurement of the relationship between the prices of different common stocks which are issued by the companies trading publicly.

The PE ratio is measured though the division of current market price with the Earning per Share. As the stock prices are mostly changed in the new financial report generated each year by the company. The PE ratios are also dependent to that change and play a role of relieve in order to monitor the increase or decrease in the stock performance of the company. At first we have to calculate the EPS in order to do the calculation for the PE ratio. The calculation is performed and is illustrated in 6th part of this paper. By using the value of EPS the PE ratio is calculated below:

Formulae:

Price Earnings Ratio = Current Share Price/Earnings per Share

Calculation:

Price Earnings Ratio = $1/0.129033

Price Earnings Ratio = 7.749935

The PE ratio of the organization is looking good. An increasing PE ratio shows that the investors are interest in investing in the organization. The given data is although not showing the previous data for the calculation of the past PE ratio, but the value is looking enough to keep the interest of the investor retained in the organization.

Question 2

Assessment of the accounting for start-up costs

The start-up cost deployed in the particular which is being discussed is $36000. The start-up cost of the business is looking ample due to the fact that the business has put them in accordance to the need of the business. The very basic condition at the time of determining the real need of the start-up business demands is ...