During Its First Year of Operations, Millwoods Enterprises Inc

question 21

Essay

During its first year of operations, Millwoods Enterprises Inc. had the following transactions related to its common shares:
Jan 5 Issued 5,000 common shares to Michelle Vogel for $ 1 each.
Mar 15 Issued 10,000 common shares in exchange for equipment transferred from Vogel. The equipment was valued at $ 40,000.
Apr 10 Issued 3,500 shares to a consulting firm for management consulting services as settlement of a $ 14,000 invoice.
Sep 30 Issued 4,000 common shares to Renee Vogel for $ 5 each.
Instructions
a) Journalize the share transactions.
b) Calculate the average per share amount of the common shares of Millwoods Enterprises Inc. at December 31, 2021.

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Definitions:

Crossover Rate

The point at which two projects have the same net present values and discounted cash flows, used in assessing investment options.

WACC

The Weighted Average Cost of Capital represents a calculation of a company's capital costs, where each capital category is weighted in proportion to its total makeup.

NPV

Net Present Value (NPV) is a financial metric that calculates the present value of all cash flows, both incoming and outgoing, associated with a project or investment.

Cash Flow

The total amount of money being transferred into and out of a business, affecting its liquidity, solvency, and operational capabilities.