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vredina [299]
3 years ago
10

Firm X is being acquired by Firm Y for $35,000 worth of Firm Y stock. The incremental value of the acquisition is $2,500. Firm X

has 2,000 shares of stock outstanding at a price of $16 a share. Firm Y has 1,200 shares of stock outstanding at a price of $40 a share. What is the actual cost of the acquisition using company stock?
Business
1 answer:
UkoKoshka [18]3 years ago
5 0

Answer:

$34,789

Explanation:

Worth of stocks = $35,000

Incremental value of the acquisition = $2,500

Stock outstanding of Firm X = 2,000

Price per share of Firm X = $16

Stock outstanding of Firm Y = 1,200

Price per share of Firm Y = $40

Now,

Number of shares issued =  35,000 ÷ 40

or

= 875 shares

Value after merger = (Value of Stock x + Value of Stock Y + Synergy)

= (1200 × 40) + (2000 × 16) + 2500

or

= $82,500

Number of Stock Outstanding after merger  = ( 1,200 + 875 )

= 2,075

Thus,

Value per share after merger = $82500 ÷ 2,075

= 39.759

Therefore,

Actual cost of acquisition

= Value per share after merger × Number of shares issued

= 875 × $39.759

= $34,789

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Assume that the banking system has total reserves of $100 billion. Assume also that required reserves are 10 percent of checking
ivolga24 [154]

Answer:

The money multiplier and money supply for this banking system is 10 and $1,000 billion respectively

Explanation:

The computation of the money multiplier and the money supply is shown below:

As we know that

Money multiplier is

= 1 ÷ required reserve ratio

= 1 ÷ 0.10

= 10

So, the money supply is

= Total Reserves × Money Multiplier

= $100 billion × 10

= $1,000 billion

hence, the money multiplier and money supply for this banking system is 10 and $1,000 billion respectively

5 0
2 years ago
Assume that the friend in the previous question notified the owner of the office building of the assignment. When the work was c
Cerrena [4.2K]

Answer:

Stop assuming then....hehe haha don't know ur previous ques and too lazy to open it and even too lazy to read it full sorry

8 0
2 years ago
Explain what the implications are to the Canadian economy if the brain drain is not stopped? Within the implications, consider t
Alinara [238K]

Answer:

Low tax collection, low working population

Explanation:

Brain drain is a condition where a country loses its population through migration. Generally, this happens with the low developing countries, because people try to search for jobs in developed countries. Canada will lose tax revenue collection and low working population as a result of the brain drain. Government is the most important stakeholder which will be affected by brain drain apart from that; hospitals and industrial units will be affected by the brain drain.

6 0
2 years ago
The following information is provided for Sacks Company before closing entries. Cash $ 12,000 Supplies 4,500 Prepaid rent 2,000
RideAnS [48]

Answer:

b. $78,500

Explanation:

Assets

Equipment                       $65,000

Cash                                 $12,000

Supplies                           $4,500

Prepaid rent                     <u>$2,000</u>

Total Assets                     <u>$83,500</u>

Equity and Liabilities

Common stock                $68,000

Retained earnings           <u>$10,500</u>

Total Equity                      $78,500

Accounts payable            <u>$5,000</u>

Total Equity and Liability <u>$83,500</u>

*<u>Working</u>

Net Profit = Service revenue - Salaries Expenses - Miscellaneous expenses

Net Profit = $30,000 - $4,500 - $20,000 = $5,500

Total retained Earning = $8,000 + $5,500 - $3,000 = $10,500

5 0
3 years ago
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