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zzz [600]
3 years ago
7

Howat Corporation earned $360,000 during a period when it had an average of 100,000 shares of common stock outstanding. The comm

on stock sold at an average market price of $15 per share during the period. Also outstanding were 15,000 warrants that could be exercised to purchase one share of common stock for $10 for each warrant exercised.
(a) Are the warrants dilutive?


(b) Compute basic earnings per share. (Round answer to 2 decimal places, e.g. $2.55.)

(c) Compute diluted earnings per share.
Business
1 answer:
Lyrx [107]3 years ago
6 0

Answer:

The answer is:

A. Yes

B. 3.6

C. 3.43

Explanation:

A. Yes, the warrants is dilutive because the average market price($15) is higher than option price($10).

B. Since there is no preferred shares or preferred dividends, the basic earnings per share is:

Net income ÷ weighted average shares

= $360,000 ÷ 100,000 shares

= 3.6

C. First we need to find the incremental shares. The formula is:

[(average market price - option price) ÷ average market price]x number of shares

[($15 - $10) ÷ $15] x 15,000 shares

$0.33333 * 15,000 shares

5,000 shares

Total number of shares is now 105,000shares(100,000 shares + 5,000)

Therefore, diluted shares is now

$360,000 ÷ 105,000 shares

3.43

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A false statement of a material fact regarding ownership of business property that results in a loss of sales is referred to as
Vedmedyk [2.9K]

Answer: Slander of title

Explanation:

Slander of title is referred to as incorrect statement about a person or business property, products and so on. This form of public statement might be written or oral which result in harm or financial loss to the person’s property title. For example: a claim of ownership of an artwork of another person or company. Thus, it is an attack on the reputation of a business property by another party.

8 0
3 years ago
Jerry's Flowers had the following cost information related to its purchases of merchandise. Calculate the total cost of merchand
ch4aika [34]

Answer:

$91,100

Explanation:

Calculation to determine the total cost of merchandise purchased

Using this formula

Total cost of merchandise purchased = Invoice cost of merchandise purchases + Cost of transportation in - Purchase returns and allowances - Purchase discount

Let plug in the formula

Total cost of merchandise purchased= $100,000 + $500 - $400 - $9,000

Total cost of merchandise purchased= $91,100

Therefore the total cost of merchandise purchased is $91,100

3 0
3 years ago
How manny people went to collage, and wish they hadn't? (This year.) (Average)
Anna007 [38]
Around 22 % this year alone.

8 0
3 years ago
Read 2 more answers
Titus Company produced 5,900 units of a product that required 3.546 standard hours per unit. The standard fixed overhead cost pe
natta225 [31]

Answer:

$417 A.

It is an adverse variance.

Explanation:

Fixed factory overhead volume variance is the difference between budgeted output at 100% normal capacity and actual production volume multiplied by standard fixed overhead cost per unit.

Formula

Fixed factory overhead volume variance = (budgeted standard hours for 100% normal capacity - Actual standard output hours) × standard fixed overhead cost per unit.

Calculation

Since 5900 units of a product was produced in 3.546 standard hours per unit, total actual standard hour is therefore;

= 5900×3.546

=20,921 hours

Overhead cost per unit = $1.10 per hour

Hours at 100% normal capacity = 21,300 hours.

Recall the formula for fixed factory overhead volume variance is =(budgeted standard hours for 100% normal output- actual standard output hours)× standard fixed overhead per unit.

Therefore;

Fixed factory overhead volume variance =(21,300 hours - 20,921 hours)× $1.10

=379 hours × $1.10

=$417 A

It is therefore an adverse variance.

4 0
3 years ago
“If the minimum wage rate is higher than the equilibrium wage rate, fewer people will be hired because the cost of labor is too
icang [17]

If the minimum wage rate is higher than the equilibrium wage rate, fewer people will be hired because the cost of labor is too high. I agree.

Explanation:

  • If the minimum wage is set above the equilibrium wage rate, it has powerful effects. The Labor Market and the Minimum Wage The equilibrium wage rate is $4 an hour. The minimum wage rate is set at $5 an hour. So the equilibrium wage rate is in the illegal region
  • If the minimum wage is set below the equilibrium wage rate, it has no effect. The market works as if there were no minimum wage. If the minimum wage is set above the equilibrium wage rate, it has powerful effects.
  • The equilibrium market wage rate is at the intersection of the supply and demand for labour. Employees are hired up to the point where the extra cost of hiring an employee is equal to the extra sales revenue from selling their output.
  • When the labor market is in equilibrium, the economy is at full employment.
5 0
3 years ago
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