1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
wolverine [178]
2 years ago
15

Neuman Corporation Convertible Bonds The following data apply to Neuman Corporation's convertible bonds: Maturity: 10 Stock pric

e: $30.00 Par value: $1,000.00 Conversion price: $35.00 Annual coupon: 5.00% Straight-debt yield: 8.00%.
A. What is the bond’s conversion ratio?
B. What is the bond’s conversion value?
C. What is the bond’s straight debt value?
D. What is the minimum price (or "floor price") at which Neuman’s bonds should sell?
Business
1 answer:
Natalija [7]2 years ago
7 0

Answer:

A. The bond’s conversion ratio is 28.57

B. The bond’s conversion value is $857.14

C. The bond’s straight debt value is $798.70

D. The minimum price at which Neuman’s bonds should sell is $857.14

Explanation:

A. In order to calculate the bond’s conversion ratio we would have to calculate the following formula:

bond’s conversion ratio=par value/conversion price

According to the given data:

par value=$1,000

Conversion price=$35

Therefore, bond’s conversion ratio=$1,000/$35

bond’s conversion ratio=28.57

B. To calculate the bond’s conversion value we would have to make the following calculation:

bond’s conversion value=bond’s conversion ratio*Stock price

bond’s conversion value=28.57*$30.00

bond’s conversion value=$857.14

C. To calculate the bond’s straight debt value we would have to calculate the following formula:

bond’s straight debt value=PV(0.08,10,50,1,000)

bond’s straight debt value=$798.70

D. The minimum price at which Neuman’s bonds should sell is $857.14

You might be interested in
Suppose the total number of minutes provided exceeds the total number of minutes estimated and that the total dollar cost of the
Margarita [4]

Answer:

C) In at least one of the higher technical levels ,more minutes being provided than budgeted.

Explanation:

For such discrepancy to exist ,it means the minutes dictates the effect of the dollar.

5 0
3 years ago
On January 2 Kelly company performed $800 worth of services for a client. The client paid $100 immediately, but promised to pay
Sliva [168]

Answer:

$100, $700, $800

Explanation:

Calley Journal entries would include:

Debiting $100 to the cash account

Debit the $700 to the receivables account

Credit $800 to the revenue account

This follows the double entry rule that a credit in one account must correspond to at least one debit in another account.

We debit all asset accounts(receivables,cash) when increased and credit all liabilities account when increased. We credit all income account(revenue) when increased and debit all expenses account when increased.

6 0
3 years ago
Read 2 more answers
Which of the following is NOT a step in the strategic planning process?A) defining the company missionB) setting company objecti
Colt1911 [192]

Answer:

Which of the following is NOT a step in the strategic planning process?

E) evaluating all members of the value chain

Explanation:

Strategic planning is an organization's process of defining its strategy, or direction, and making decisions on allocating its resources to pursue this strategy. It may also extend to control mechanisms for guiding the implementation of the strategy

4 0
3 years ago
Genent​ Industries, Inc.​ (GII), developed standard costs for direct material and direct labor. In​ 2017, GII estimated the foll
Alex_Xolod [135]

Answer:

The quantity variance = -900 unfavorable

Explanation:

Direct materials flexibel - budget variance:

standard

0.7 pounds $30 per pound

3,000 x 0.7 = 2,100 standard pounds

actual

2,400 pound $29 per pound

quantity variance:

30(2,100 - 2,400) = -900

6 0
2 years ago
Pizza ltd. leased equipment from Tasty Company under a four-year lease requiring equal annual payments of sh.86, 038, with the f
adoni [48]

Answer:

Sh. 300,001.60

Explanation:

Note: <em>Missing word has been attached</em>

Particulars                                                     Amount

Annual payments                                          86,038

x PV Annuity due 8%, 10 periods                 3.48685

Amount recorded for the leased asset      300,001.60

8 0
2 years ago
Other questions:
  • Assume the MPC is 0.8. Assuming only the multiplier effect matters, a decrease in government purchases of $100 billion will shif
    11·1 answer
  • What is the difference between a good and a service?
    9·1 answer
  • Nicole owns a small organic spice company called RaisaSpice and was looking for a new product to add to her company's line. A fr
    5·1 answer
  • Suppose the government passes a law eliminating holidays and, as a result the production of goods and services increases because
    6·1 answer
  • Assume you run the central bank of a large open economy with floating exchange rates. Output, unemployment and inflation are whe
    12·1 answer
  • State University sold all of its basketball tickets to its students for 15 home games on September 30 for​ $1,200,000 (basketbal
    7·1 answer
  • The term ________ refers to a factory that is guilty of some sort of labor abuse or violation, such as unsafe working conditions
    11·1 answer
  • In the multiplex industry, Vibrant Movies Inc. is an upscale multiplex that focuses on superior customer experience. The firm ch
    5·2 answers
  • Income Statement Wayne Corporation had the following revenue and expense account balances (in millions) for a recent year ending
    13·1 answer
  • If Depressants such as alcohol, ___________and sedatives affect the central nervous system by slowing down or depressing reflexe
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!