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Ostrovityanka [42]
4 years ago
12

You are doing some analysis on the has a market value that is equal to its book value. Currently, the firm has excess cash of $1

,000 million and other assets of $9,000 million. Equity is worth $10,000 million. The firm has 700 million shares of stock outstanding and net income of $1,575 million. What will the new earnings per share be if the firm uses 25 percent of its excess cash to complete a stock repurchase?
Business
2 answers:
ikadub [295]4 years ago
8 0

Answer:

the new earnings per share will be 231 cents

Explanation:

Earnings per share is Earnings attributable to each Common Share.

Earnings Per Share = Earnings attributable to Holders of Common Stock/ Weighted Average Number of Common Shares

                                = $1,575 million/ (700 million-250/10000×700 million)

                                = $1,575 million/(700 million-17,2 million)

                                = 231 cents

wariber [46]4 years ago
8 0

Answer:

Earnings per share is $2.31

Explanation:

value of one share=$10,000 million/700 million=$14.29

25% of excess cash =25%*$1000 million=$250 million

Number of shares repurchased=$250 million/$14.29=17.5 million

Outstanding shares after share repurchase=700 million-17.5 million

                                                                       =682.5 million

Earnings per share =earnings attributable to common stock/number of common stock

earnings stands at $1,575 million

number of common stock 682.5 million

Earnings per share=1,575 million/682.5 million

Earnings per share=$2.31 or 231 cents

The new earnings per share is $2.31 or 231 cents as shown in the step by step analysis above.

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Answer:

$1,000

Explanation:

The above means that for every $1 increase in the market value in a long margin account, the SMA increases by $0.50

If the market value rises to $22,000, the account will show

Long market value - Debit = Equity % SMA

$22,000 - $10,000 = $12,000

Against $22,00 of market value, 50% can be borrowed or $11,000. Since the debit is $10,000, an additional $1,000 can be borrowed . This is the SMA

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3 years ago
Assume the MPC is 0.6. If government were to impose $10 billion of new taxes on household income, consumption spending would ini
mihalych1998 [28]

Answer:

$6 billion

Explanation:

Calculation to determine what consumption spending would initially decrease by

Using this formula

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Let plug in the formula

Decrease in Consumption spending=0.6*$10 billion

Decrease in Consumption spending=$6 billion

Therefore consumption spending would initially decrease by $6 billion

4 0
3 years ago
Mr. Henshaw, CEO of MBA Bank, decides that the organization needs to provide more convenient service to customers. He decides to
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Answer: unfreezing

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The unfreezing stage of Lewis change process is being regarded as the first stage of change, and in this stage, an organization is being prepared and accept that change is inevitable and necessary and that existing status quo should also be broken.

This is illustrated in what Mr. Henshaw, CEO of MBA Bank did, by deciding that the organization needs to provide more convenient service to customers.

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An appraiser has just completed a search of the records for comparable residential properties that have sold within the last six
BigorU [14]
I believe the Appraier is using: <span>Direct Sales Comparison Approach (mostly used with residential properties.
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The information given is differentiated into either managerial accounting or financial accounting below:

  • Main characteristic of data is that it must be reliable and objective = Financial accounting.
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  • Primary users are external (i.e creditors, investors) = Financial accounting
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  • Information is verified by external auditors = Financial accounting
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<h3>What is managerial accounting?</h3>

Managerial accounting is a method of accounting that creates statements, reports, and documents that help management in making better decisions.

Financial accounting is concerned with the summary, analysis and reporting of financial transactions related to a business.

Learn more about managerial accounting on:

brainly.com/question/4952511

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