Professional Research: FASB Codification
Recall from Chapter 13 that Hincapie Co. (a specialty bike-accessory manufacturer) is expecting growth in sales of some products targeted to the low-price market. Hincapie is contemplating a preferred stock issue to help finance this expansion in operations. The company is leaning toward participating preferred stock because ownership will not be diluted, but the investors will get an extra dividend if the company does well. The company management wants to be certain that its reporting of this transaction is transparent to its current shareholders and wants you to research the disclosure requirements related to its capital structure.
Instructions
If your school has a subscription to the FASB Codification, go to https://aaahq.org/ascLogin.cfm to log in and prepare responses to the following. Provide Codification references for your responses.
(a)
Identify the authoritative literature