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Happy Thursday, future bankers!

Hope everyone is doing well! Today we’re covering APIC, what your brand’s motto would be, and Apple’s latest AI acquisition.

🚀 Let’s get into it.

🔢 Technical Question

What is APIC and where does it show up in the financial statements?

Additional Paid-In Capital (APIC) is an accounting term that refers to the money an investor pays above and beyond the par value price of a stock. Here’s how it works:

1. Initial Public Offering (IPO): APIC occurs when an investor buys newly-issued shares directly from a company during its IPO stage.

2. Setting the Price: During its IPO, a firm is entitled to set any price for its stock that it sees fit.

3. Investor’s Bid: Investors may elect to pay any amount above this declared par value of a share price, which generates the APIC.

4. Calculation: The APIC is calculated as the difference between the issue price of a stock and its par value, multiplied by the number of shares acquired by investors. In other words, APIC = (Issue Price – Par Value) x Number of Shares Acquired by Investors.

5. Recording: APIC is usually booked as shareholders’ equity on the balance sheet. The total cash generated by the IPO is recorded as a debit and the common stock and APIC are recorded as credits.

It’s important to note that APIC is recorded at the IPO only; transactions that occur after the IPO do not increase the APIC account. This means that APIC only occurs in the primary markets, i.e., when the investor buys shares in a company directly from the company itself.

🗣 Behavioral Question

If you were a brand, what would be your motto?

Here are some steps to consider when answering the question:

1. Reflect on Your Strengths: Think about the qualities that make you a strong candidate for an investment banking internship. This could be your analytical skills, attention to detail, or ability to work under pressure.

2. Align with the Industry: Since you’re interviewing for an investment banking position, your motto should reflect the values and skills relevant to the industry. For example, integrity, diligence, and analytical acumen are highly valued in this field.

3. Be Concise and Memorable: A good motto is short, impactful, and easy to remember. It should encapsulate your personal brand in a catchy and concise way.

4. Make It Personal: While your motto should be professional, it should also give the interviewer insight into who you are as a person. Don’t be afraid to let your personality shine through.

5. Practice Your Delivery: How you deliver your answer can be just as important as the content. Practice your response so that you can deliver it confidently and sincerely.

For example, if you’re someone who prides themselves on their analytical skills and ability to make sound decisions under pressure, your motto might be: “Turning complexity into clarity.”

Remember, the goal is to convey your unique value proposition as a potential intern in a way that is memorable and aligns with the values of investment banking.

🗞 Industry News

🍎 Apple Acquires an AI Startup

Apple has acquired the Canadian artificial intelligence startup DarwinAI, in a move to bolster its technology capabilities ahead of a significant push into generative AI in 2024. The acquisition, which took place earlier this year, saw numerous DarwinAI employees join Apple’s artificial intelligence division. DarwinAI’s technology, which includes AI for visual inspection of components during manufacturing and making AI systems smaller and faster, could be beneficial to Apple’s focus on device-based AI.

The acquisition precedes Apple’s major AI initiative this year, with the addition of features to its iOS 18 software that rely on generative AI. Despite acquiring more AI companies than most competitors over the past decade, Apple has lagged in the generative AI market. However, the company is now integrating generative AI into its operations, using the technology for customer service requests, auto-creating presentations, completing blocks of texts, and assisting developers with a new version of its Xcode programming software. Apple CEO Tim Cook has promised groundbreaking advancements in AI this year, with an announcement expected at the company’s worldwide developers conference in June.

Read more about this story below.

Thanks for tuning in today! Best of luck to everyone working through recruiting right now. If you sign an offer, reply to this email and let us know about it! Like seriously, do it—we’d love to hear about it!