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pentagon [3]
3 years ago
7

Warrants exercisable at $20 each to obtain 30,000 shares of common stock were outstanding during a period when the average marke

t price of the common stock was $25. Application of the treasury stock method for the assumed exercise of these warrants in computing diluted earnings per share will increase the weighted average number of outstanding shares by
Business
1 answer:
aivan3 [116]3 years ago
3 0

Answer:

The increase in weighted average number of common shares is by 6,000 shares

Explanation:

Application of treasury method is used for exercising the warrants.

Outstanding Common shares = Number of shares / Market price * Exercisable price

= 30,000 shares / $25 * $20

= 24,000 shares

After the warrants have been exercise, the increase in weighted average number of common shares is as follows:

Increase in weighted average number of shares = 30,000 shares - 24,000 shares

= 6,000 shares

Thus, the increase in weighted average number of common shares is by 6,000 shares.

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Barlow owns the surface rights for Canyon Ranch, but does not own the subsurface rights. Dusty owns the subsurface rights. Canyo
yarga [219]

Answer:

A) Dusty.

Explanation:

Generally, when you are dealing with property rights and any damages that occur to real property, the individual that possesses the oldest structure can sue other individuals that damage his/her structure by building or developing a new one.

E.g. in many cities, buildings or even homes tend to be built right next to other homes or buildings (specially in down town areas). If you are building a house right next to an existing house and the walls are damaged because because you dug to build a basement, then you are responsible and liable for the damages even if you never invaded the other property.

6 0
3 years ago
Presented below are two independent situations.
rewona [7]

Answer: a)Interest expense for Year 2020=$46, 977.50 b) see explanation column

Explanation:

a) Amount of Note payable =  $550,000

Present Value  factor for 3 years at 12%

= PV = 1/(1+r) ^n  

1/ (1+ 12%)^3 =(0.892857143)^ 3 =  0.71178

Present value of Note for land at 2020 = $550,000  x  0.71176 = $391, 479

.136

Interest expense for Year 2020= $391, 479.136  x  12%= $46, 977.50

b) Face value of note = $5,000,000

Present value factor for 4 years at 10 % =

= PV = 1/(1+r) ^n  

1/ (1+ 10%)^4 =(0.909090909)^ 4 =  0.68301345

Present value of the note = $5,000,000 x 0.68301345= $3,415,067.28

Discount on note payable =$5,000,000 -$3,415,067.28 =$1,584,932.72

Journal to record amount of interest to report for 2020

Date   Account                        Debit                      Credit

Jan 2020   Cash                  $5,000,000

Discount on notes payable                             $1,584,932.72  

Notes payable                         $5,000,000

interest revenue                                              $1,584,932.72

5 0
3 years ago
Airbase is a consumer electronics company known for its affordable mobile devices that follows a cost-leadership strategy. In th
lapo4ka [179]

Answer: 4. a consumer electronics company popular among price-conscious customers.

Explanation: Companies who thread a cost-leadership strategy or path could be said to be 'price-centric', that is gives price huge cognizance and will strive to be a market or industry leader when it comes to giving best and most affordable prices on products.

Thus, since Airbase follows a cost leadership strategy and also popular among consumers for its affordable devices, it should also weigh or compare it's strategy to other consumer electronics company which is popular among consumers which gives cognizance to price of products they purchase.

5 0
3 years ago
One of the​ trade-offs Tesla faces is between safety and the maximum range someone can drive an​ all-electric car before having
Nina [5.8K]

<u>Answer:</u>

<em>A creation conceivable outcomes outskirts demonstrates the most extreme sum that an economy can deliver.</em>

<u>Explanation:</u>

The creation plausibility outskirts is a marginalist model that mirrors the most extreme amounts of merchandise and ventures that a nation or endeavour is fit for delivering in a given period and dependent on certain generation factors and innovative learning. Hence there are three circumstances in the profitable structure of a nation or endeavour:

  • Inefficient beneficial structure: When it is underneath the PPF, that is, either all assets are not utilized (inactive assets), or the innovation isn't satisfactory.
  • Efficient beneficial structure: It is situated before the fringe or near it. There are no inactive assets and the best innovation is being utilized.
  • Unattainable beneficial structure: It is over the generation potential outcomes. It is hypothetical since no nation or endeavour can deliver past its ability.
7 0
3 years ago
1) A stock pays a dividend of $10 per share. It has a cost of capital, K of 8%. It has a constant growth rate of 3%. Use the Con
alekssr [168]

Answer:

answer is A) $206 B) $61.31

Explanation:

to calculate price of the stock at zero we use dividend discount model formula

P0= D(1+G)/(r-g)

     10(1.03)/(0.08-0.03)

       $206

b) The dividend is said to be 2% of the free cash flow therefore can be calculated as $10*0.2=$2 per share

then calculate divide growth rates

D1=2*1.3 =2.6

D2=2*(1.3)(1.3)=3.38

D3 = 2*(1.3)(1.3)(1.3)=4.394

Claculate the discount rate using CAPM according to given information

R= 0.2+ 1.5(0.08-0.02)

 = 0.11/11%

Use the dividend discount model to calculate the price of the stock

P0= 2.6/1.11+3.38/1.3²+4.394*(1.05)/(0.11-0.05)

2.342+2.743+56.225

=$61.31

7 0
3 years ago
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