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Leno4ka [110]
3 years ago
5

g "6. Financially, why would a company: (a) increase its dividend; (b) buy back some of its common stock shares; (c) pay down so

me of its debt; (d) increase its use of internal financing; (e) take the public firm private?"
Business
1 answer:
VikaD [51]3 years ago
5 0

Answer:

(a) increase its dividend;

dividends are increased for two reasons:

  1. the company has excess cash and it doesn't have any possible investments on hand
  2. the board and upper management want to increase the stock price and higher dividends always result in higher stock prices, even if it is only in the short run.

(b) buy back some of its common stock shares;

  • the company has excess cash and the board and upper management believe that the stock price is too low.

(c) pay down some of its debt;

  • the company has excess cash and it considers that the cost of its debt is too high and it can get cheaper financing from other sources if needed.

(d) increase its use of internal financing;

  • the board and upper management considers that the company needs to invest in new or existing projects and they consider that the financing costs are too high. Also, on the long run if things work well, the stock price should increase.

(e) take the public firm private

  • the company has excess cash and the board and upper management believe that the stock price is too low. It is similar to (b) only on an extreme situation.

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Gnesinka [82]

Answer: $250,000

Explanation:

The amount at which buildings and equipment will be reported in consolidated statements immediately following the acquisition will be the value of the book value of Primo's equipment which is $50,000 plus Secondo’s book value of its buildings and equipment which is $200,000.

Therefore, the answer will be:

= $50,000 + $200,000

= $250,000

5 0
3 years ago
What is the par value of a corporate bond that was issued with an 9% annual coupon, pays $45 in semiannual interest, and is due
nasty-shy [4]

Answer:

$1,000

Explanation:

A bond's par value is the bond's face value or maturity value. This is the amount that the bondholder will collect once the bond matures. The coupon is calculated by multiplying the bond's par value times the coupon rate (interest rate). In this case, the coupon rate is 9% / 2 = 4.5% because it pays a semiannual coupon.

coupon = bond's par value x coupon rate

$45 = bond's par value x 4.5%

bond's par value = $45 / 4.5% = $1,000

3 0
4 years ago
The 12-month period that ends when a company's sales activities are at their lowest level is called the:
loris [4]
Natural business year 
4 0
4 years ago
Read 2 more answers
Minion, Inc., has no debt outstanding and a total market value of $211,875. Earnings before interest and taxes, EBIT, are projec
Troyanec [42]

Answer:

Please see attached.

Explanation:

a. Calculate earnings per share EPS under each of the three economic scenarios

a.2 Calculate the percentage changes in earnings per share EPS for economic expansion, or recession.

b-i calculate economic per share EPS, under each of the three economic scenarios after recapitalisation.

b-2 calculate the percentage changes in EPS when the economy enters or expand a recession assuming no recapitalisation occurred.

Please find attached detailed solution to the above questions.

5 0
4 years ago
Marla is an associate at JCPenney who wants to work 40 hours week but works 25 hours a week because sales at JC Penney are slow.
xxMikexx [17]

Answer:

Economic ; Economic

Explanation:

A decision will be considered as 'economic reason' if that decision is based on monetary benefit. This is what Maria's intention when working at JCPenny. She just wants to get the highest salary as possible.

Joe on the other hand, works for patron.

Meaning that He works there seeking for connections. Even though he is not aiming directly for money/salary, getting connections actually a monetary reasons since it often lead to more career/business opportunities.

7 0
3 years ago
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