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mixer [17]
3 years ago
15

Supreme Industries issues the following announcement to holders of an issue of​ callable, convertible​ notes: ​"Prior to the clo

se of business on May​ 17, 2008, holders may convert their Notes into shares of Supreme Industries common stock at 29.45 shares of Supreme Industries common stock per​ $1000 principal amount of the Notes. Cash will be paid in lieu of fractional shares. On April​ 16, 2008, the last reported sale price of Supreme Industries common stock on the NYSE was $ 22.60 per​ share." If on May​ 17, Supreme Industries is trading as $ 24.30​, what is the value of common stock a holder of a​ $1,000 note would​ receive?
Business
1 answer:
777dan777 [17]3 years ago
4 0

Answer:

The value received by holder of $1,000 is $831.8

Explanation:

$1000 notes will get 33.95 shares which says 33 shares and teh cash equal to the 0.95 shares value. The convertible Bonds (CB) are converted at the will of holders into the shares or cash. The conversion price is the trading price of the share which is $24.20. Thus, a hoder of $1,000 will receive the following value:-

1) 33 shares at 24.50 which is equal to :-

 =33\times 24.50=808.5

2) The cash which is equal to 0.95 share. 1 share is valued at $24.50 thus 0.95 share will be valued at:-

 \frac{24.5}{1}\times 0.95=23.3

Thus total value of the common stock will be :

808.5+23.3=831.8

Thus, the value received by holder of $1,000 is $831.8

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The following accounts which are classified as shareholders' equity are Additional paid-in capital, Common stock ,Retained earnings.

Option A, B, C is correct.

<h3>Shareholder Equity:</h3>

Shareholder Equity is the amount invested in the business by the owner of the business. This includes the money they have invested directly and the accumulation of earnings earned by the company that has been reinvested since its inception.

<h3>Is equity a liability or an asset?</h3>

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Learn more about shareholder equity:

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5 0
1 year ago
A certain person goes for a run each morning. when he leaves the house for his run, he is equally likely to go out either the fr
boyakko [2]
<span>if there are no shoes at the door from which he leaves to go running, he runs barefoot. but i would think this to be a math probability question</span>
7 0
3 years ago
Grace wants to become a manager at the bank where she is currently a teller. Which of the following goals would be appropriate f
fgiga [73]

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7 0
3 years ago
At the beginning of the current accounting period Blazer Company had a $40,000 balance in its Finished Goods Inventory account.
Salsk061 [2.6K]

Answer:

The correct answer is A.

Explanation:

Giving the following information:

Beginning finished goods inventory= $40,000

During the period cost of goods manufactured amounted to $280,000. The ending balance in the Finished Goods Inventory account was $42,000.

To calculate the cost of goods sold, we need to use the following formula:

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3 years ago
Straight Industries purchased a large piece of equipment from Curvy Company on January 1, 2019. Straight Industries signed a not
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Answer:

$30,604

Explanation:

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3 0
2 years ago
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