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
monitta
3 years ago
7

Anderson Steel Company began 2018 with 550,000 shares of common stock outstanding. On March 31, 2018, 140,000 new shares were so

ld at a price of $50 per share. The market price has risen steadily since that time to a high of $55 per share at December 31. No other changes in shares occurred during 2018, and no securities are outstanding that can become common stock. However, there are two agreements with officers of the company for future issuance of common stock. Both agreements relate to compensation arrangements reached in 2017. The first agreement grants to the company president a right to 42,000 shares of stock each year the closing market price is at least $53. The agreement begins in 2019 and expires in 2022. The second agreement grants to the controller a right to 47,000 shares of stock if she is still with the firm at the end of 2026. Net income for 2018 was $5,200,000.
Required:
Compute Anderson Steel Company's basic and diluted EPS for the year ended December 31, 2018. (Enter your answers in thousands.)
Business
1 answer:
iren [92.7K]3 years ago
4 0

Answer:

EPS = $7.94

diluted EPS = $7.94, since there are no diluted shares in 2018

Explanation:

January 2018 = 550,000 common stocks

March 31 = 140,000 new shares issued = 105,000 weighted stocks

net income = $5,200,000

EPS = net income / weighted common stocks = $5,200,000 / (550,000 + 105,000) = $5,200,000 / 655,000 stocks = $7.939 ≈ $7.94 per stock

there are no diluted shares since the agreement with the president of the board starts in 2019, and we are calculating the EPS for 2018. The same applies to the controller, since her agreement starts in 2026.

You might be interested in
Calculate the present value of the following sequence of willingness to pay: $150 this year; $150 next year; $150 in year 2, and
goldenfox [79]

Answer:

$472.10

$482.78

decreasing the discount rate increases the present value of the willingness to pay

Explanation:

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

Cash flow in year 0 - 2 = $150

Cash flow in year 3 = $50

PV when I is 5% = 472.10

PV when I is 3% = 482.78

To find the PV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

2. after inputting all the cash flows, press the NPV button, input the value for I, press enter and the arrow facing a downward direction.  

3. Press compute  

7 0
3 years ago
The required return on the stock of Moe's Pizza is 10.4 percent and aftertax required return on the company's debt is 3.28 perce
Katarina [22]

Answer:

WACC - new project = 6.408% rounded off to 6.41%

Explanation:

The WACC or weighted average cost of capital is the cost of a firm's capital structure. The capital structure can consist of one or more of the following components namely debt, preferred stock and common equity. The WACC is calculated as follows,

WACC = wD * rD * (1 - tax rate)  +  wP * rP  +  wE * rE

Where,

  • w represents the weight of each component
  • r represents the cost of each component
  • D, P and E represents debt, preferred stock and common equity
  • rD * (1 - tax rate) is the after tax cost of debt

We first need to calculate the WACC of the company and then adjust it for the new project.

WACC = 35% * 3.28%  +  65% * 10.4%

WACC = 7.908%

As the new project is less risky and has an adjustment factor of -1.5%, the required rate of return for the new project will be,

WACC - new project = 7.908%  -  1.5%  

WACC - new project = 6.408% rounded off to 6.41%

4 0
3 years ago
Suppose that the owner of the small business you work for is planning to raise prices in order to increase revenues. The busines
andriy [413]

Answer:

B

Explanation:

Less competition equals hgiher prices.

6 0
3 years ago
What is the predominant source of financing for positive npv projects by u.s. nonfinancial corporations?
ch4aika [34]

The primary source of funding for positive npv projects by U.S. nonfinancial firms is internally generated funds

Internally Generated Monies are funds that are not the result of a loan, a debt issue, an equity issue, the sale of an asset, an insurance recovery, or any other debt. Internal funding is the practice of paying for energy efficiency, renewable energy, or other generation initiatives out of an organization's current financial resources as opposed to seeking outside funding. By dividing the bank's retained earnings by the average equity balance of all stockholders for a specific accounting period, the internal capital generation rate is determined.

Learn more about Internally Generated funds here

brainly.com/question/7285255

#SPJ4

4 0
2 years ago
accenture is involved in the transformation of an organization into a data driven and intelligent enterprice. which ability does
Vlad [161]

Group of answer choices.

A. to collect exabytes and zettabytes of data from different sources

B. to gather, re-organize, and store different categories of all raw data for easy and faster retrieval

C. to store large amounts of data including raw and unorganized facts

D. to capture, curate, and consume the right data sets

Answer:

B. to gather, re-organize, and store different categories of all raw data for easy and faster retrieval

Explanation:

A database management system (DBMS) can be defined as a collection of software applications that typically enables computer users to effectively and efficiently create, store, modify, retrieve, centralize and manage data or informations in a database. Thus, it allows computer users to efficiently retrieve and manage their data with an appropriate level of security.

Generally, a database management system (DBMS) acts as an intermediary between the physical data files stored on a computer system and any software application or program.

Hence, a software that enables the organization to centralize data, manage the data efficiently while providing authorized users a significant level of access to the stored data, is called a Data Base Management System (DBMS).

One of the world's largest management and technological consulting company that provide services such as database management, consulting, strategy and outsourcing is Accenture.

Basically, Accenture help businesses in the implementation of data governance and management policies so as to ensure their data is trustworthy and reliable.

Thus, they're involved in the strategic transformation of an organization, business firm or company into a data driven and intelligent business enterprise.

Hence, the ability accenture need to ensure the organization has to become a successful business​ is to engage in the gathering, arrangement or reorganizing, and storage of different categories of all raw data for easy, effective, efficient and faster retrieval.

7 0
3 years ago
Other questions:
  • In a reinforcement type of situation, program plans are initiated to preserve and develop customer or public support.
    11·1 answer
  • The selling price of houses would be most likely to increase if there were a decrease in which of the following?
    9·2 answers
  • From selling strictly components to solving its​ customers' problems with more tailored offerings. this is an example of​ ______
    10·2 answers
  • The records of Norton, Inc. show the following for July. Standard labor-hours allowed per unit of output 1.2 Standard variable o
    5·1 answer
  • Omestead crafts, a distributor of handmade gifts, operates out of owner emma finn's house. at the end of the current period, emm
    8·1 answer
  • Almost certainly you have seen vending machines being serviced on your campus and elsewhere. On a predetermined schedule the ven
    7·1 answer
  • Xiong Co. uses a periodic inventory system. Its records show the following for the month of May, in which 65 units were sold. Un
    12·1 answer
  • On January 1, the company purchased equipment that cost $10,000. The equipment is expected to be worth about (or has a salvage v
    5·1 answer
  • $400 invested with compound interest at a rate of 3% per year for 2 years. Formula: M = P(1+ i)n
    9·1 answer
  • Harry starts receiving reduced retirement benefits at age 62. these benefits:______.
    7·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!