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Answer:
Value of preferred stock will be $140
Explanation:
We have given par value of preferred stock = $100
Dividend rate = 14 %
Discount rate on preferred stock = 12%
Preferred stock dividend
We have to find the value of preferred stock
Value of preferred stock
So value of preferred stock will be $140
Answer:
$222,100
Explanation:
Cost = $837,300
Residual value = $84,000
Useful life = 9 years
Now,
Annual straight line depreciation =
Annual straight line depreciation =
Annual straight line depreciation =
Annual straight line depreciation = $83,700
Accumulated depreciation for three years i.e., 2018, 2019 and 2020 would be:
Accumulated depreciation = 3 × $83,700
Accumulated depreciation = $251,100
Book value (at the end of year 2020) = Cost - Accumulated depreciation
Book value (at the end of year 2020) = $837,300 - $251,100
Book value (at the end of year 2020) = $586,200
Revised useful life = 5 years
No. years asset has been used = 3 years
Remaining useful life = 2 years
Revised salvage value = $142,000
Therefore, depreciation expense for the remaining three year would be:
Revised depreciation expense =
Revised depreciation expense =
Revised depreciation expense =
Revised depreciation expense = $222,100
Answer:
(a) The Net Payoff: 6.75+5 = - 1.75 (b) Net payoff : 5
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Sources: The image was researched from Course hero
Explanation:
Solution
Given that:
The call value goes higher when the underlying price increases and vice versa.
The premium value of put goes higher when underlying market decreases and vice versa.
The call value = Spot price - strike price (minimum zero)
The put value = Strike price - spot price (minimum zero
(1): Trade: Buy February Call
Now
The Strike Price: $ 190
The Call Premium paid: $ 6.75
The Stock Price on Expiry: $ 195
Value of call on expiry: $ 5
The Net Payoff: 6.75+5 = - 1.75
(2). Trade: Buy February Put
The Strike Price: $195
Put Premium: $ 5.00
Stock Price on Expiry = $ 195
Value of Put on Expiry: 0
Net payoff : 5
