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The Capitalization of Goodwill

The Capitalization of Goodwill


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About the Book

This historic book may have numerous typos and missing text. Purchasers can download a free scanned copy of the original book (without typos) from the publisher. Not indexed. Not illustrated. 1921 Excerpt: ...equipment, amounting to almost $10,000,000, would have been worth very little. The preferred issued, therefore, was covered by the inventories, which amounted to more than $14,500,000, and the amount authorized was very little more. Generally considered, the earnings on the common stock of the agricultural implement companies and of the rubber and tire companies were high, whereas the earnings for the automobile companies were below the average. Inasmuch as the preferred issues of these companies were small when compared to the tangible assets, it is natural to ask whether the issues of common were correspondingly small when compared to the earnings. In other words, the possible relation of the figures in column 2 with those in column 4 is suggested. Was a conservatively issued preferred stock likely to be accompanied by a conservative issue of common? It is natural that there should be a certain relation between the figures in the second and fourth columns inasmuch as in both cases they are affected by the amount of preferred stock. If this amount is small not only will the ratio of tangible assets to the preferred be comparatively high, but the earnings on the common will be larger because of the smaller deduction necessary for the preferred dividends. An estimate of this relation in mathematical terms seems to show that the ratios in the two columns are not so closely related as one might expect. Furthermore, it is evident that there is a greater dispersion for the percentages in the fourth column than for the ratios in the second. Preferred stock issues in relation to tangible assets varied much less than common stock issues in their relations to earning power. The principles deducible from the data given in the table, important as they are, do not furn...


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Product Details
  • ISBN-13: 9781152818439
  • Publisher: Rarebooksclub.com
  • Publisher Imprint: Rarebooksclub.com
  • Height: 246 mm
  • No of Pages: 30
  • Spine Width: 2 mm
  • Width: 189 mm
  • ISBN-10: 1152818430
  • Publisher Date: 01 May 2012
  • Binding: Paperback
  • Language: English
  • Returnable: N
  • Weight: 73 gr


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