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Doss [256]
3 years ago
14

Under its executive stock option plan, W Corporation granted options on January 1, 2021, that permit executives to purchase 28 m

illion of the company's $1 par common shares within the next eight years, but not before December 31, 2023 (the vesting date). The exercise price is the market price of the shares on the date of grant, $19 per share. The fair value of the options, estimated by an appropriate option pricing model, is $5 per option. No forfeitures are anticipated. The options are exercised on April 2, 2024, when the market price is $22 per share. By what amount will W's shareholders equity be increased when the options are exercised
Business
1 answer:
ratelena [41]3 years ago
3 0

Answer:

$532 million

Explanation:

Number of common stock executives are permitted to purchase = 28 million

Exercise price = Market price of the shares on the date of grant = $19 per share

Amount of increase in W's shareholders equity = 28 million * $19 = $532 million

Therefore, W's shareholders equity will increase by $532 million when the options are exercised.

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Which of the following terms is NOT specifically defined under the Uniform Securities Act?A) Broker-dealerB) Broker-dealer repre
olga2289 [7]

Answer:

B. Broker-dealer representative.

Explanation:

The Uniform Securities Act defines a broker-dealer, it defines a representative of a broker-dealer, it defines an investment adviser, and it defines an investment adviser representative. So Overall, the term not specifically defined under the securities act is broker-dealer representative.

6 0
3 years ago
Serendipity Inc. is re-evaluating its debt level. Its current capital structure consists of 80% debt and 20% common equity, its
Dmitriy789 [7]

Answer:

8.76%

Explanation:

Using the CAPM formula:

Ke = Rf + Beta Factor * Risk premium

Here

Rf is 5%,

Beta Factor is 1.6

And

Risk Premium is 6%

By putting values, we have:

Ke = 5% + 1.6 * 6%

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Now we will find new firm's cost of equity under 40% debt by simply multiplying it with the equity percentage:

Weighted Cost of Equity = 14.6% * 60% = 8.76%

8 0
4 years ago
In response to an upturn in the economy, entrepreneurs seek to expand their businesses. a. What will happen to nominal interest
kicyunya [14]

a. Nominal interest rates Increase and Aggregate demand Decrease

b. New Fed policy Buy bonds

Explanation:

When contemplating unemployment, the nominal interest rate applies to the rate of interest. Net may, without taking into consideration any commissions or compounded interest, be related to the advertised or reported interest rate of a loan.

The aggregate demand (AD) for finished commodities and facilities in the market at a certain time is aggregated. Strong demand is often named, but this term is often used in many ways. This is the market for a country's gross national product.

When the Fed sells debt in the international market, the world economy money supply is expanded by exchanging debt for cash from the general public. Instead, when the Fed sell bonds, the supply of money is reduced by cash being pulled out of the market in return for bonds. The Fed also sells bonds.

7 0
3 years ago
a process cost system, the cost of completed production in Department A is transferred to Department B by which of the following
oee [108]

Answer:

C. Debit Work in Process—Dept. B; credit Finished Goods—Dept. A

Explanation:

It is known that during continuous production, businesses find it difficult to isolate each individual unit and calculate a cost. Process costing systems accumulate the materials, labor and overhead costs for the period along with the total number of units produced. The total number of units produced includes both completed units and partially completed units. The company determines the percentage of completion for each partially completed unit and adds these amounts to the total number of completed units to determine the equivalent units.

4 0
4 years ago
Is god real yes or no answer
dem82 [27]
There is no factual evidence to either. Modern Christianity is based off of faith, you gotta believe he’s real. And in most other religions their god/gods are real. The only “proof” is either miracles or visions. Which in most cases can’t always be proven true. I say yes, but only because I believe he is.
5 0
3 years ago
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