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salantis [7]
3 years ago
10

Under its executive stock option plan, W Corporation granted options on January 1, 2021, that permit executives to purchase 15 m

illion of the company's $1 par common shares within the next eight years, but not before December 31, 2023 (the vesting date). The exercise price is the market price of the shares on the date of grant, $18 per share. The fair value of the options, estimated by an appropriate option pricing model, is $4 per option. No forfeitures are anticipated. The options are exercised on April 2, 2024, when the market price is $21 per share. By what amount will W's shareholder's equity be increased when the options are exercised
Business
1 answer:
stiv31 [10]3 years ago
5 0

Answer:

$270m

Explanation:

We can calculate the amount that will increase W's shareholder's equity when the options are exercised as follows

Increase in equity =  No Options Granted x Exercise price at the date of grant

Increase in equity = 15million x $18  

Increase in equity = $270m

       

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In which of the following cases is outsourcing likely to be the best solution to the firm's data processing needs? a) Peterson I
Alex73 [517]

Answer:

a) Peterson International is a trenchcoat wholesaler to retailers around the world. Sixty percent of sales orders are taken during the months of August and September. Peterson needs a system to manage online ordering and fulfillment.

Explanation:

Outsourcing likely to be the best solution to the firm's data processing needs because Peterson International is a trenchcoat wholesaler to retailers around the world. Sixty percent of sales orders are taken during the months of August and September. Peterson needs a system to manage online ordering and fulfillment.

5 0
4 years ago
g The company plans a 4-for-1 stock split. How many shares will you own and what will the share price be after the stock split?
Nata [24]

Answer: 14,400; $17

Explanation:

Stock splits are a strategy by firms to increase the liquidity of their shares especially when they are trading at a high price. The firm divides the stock by a certain number thus increasing the number of shares by the multiple of the number. This action will divide the price of the stock and thus allow for more trade as they are cheaper.

A 4-for- stock split means that each share will become 4.

Your total number of share will become;

= 4 * 3,600

= 14,400 shares

The new price will be;

= 68/4

= $17 per share

7 0
3 years ago
Answer the following questions using the information below: Cannady produces six products. Under their traditional cost system u
vampirchik [111]

Answer:

Given this change in the cost, the adequacy and quality of the estimated cost drivers and costs used by the system will determine the costing results for SR6 under the new system.

Explanation:

A cost driver can be described as the unit of an activity or any factor that makes the cost of an activity to fluctuate. An estimated cost driver is adequate and of the expected quality when quality or quantity is satisfactory or acceptable.

Therefore, given this change in the cost, the adequacy and quality of the estimated cost drivers and costs used by the system will determine the costing results for SR6 under the new system.

8 0
3 years ago
Which is not a secondary consideration when locating a retail store
Maslowich

The answer is "access to good schools".

A retail store is a position of business normally claimed and worked by a retailer yet now and again possessed and worked by a producer or by somebody other than a retailer in which stock is sold fundamentally to ultimate customers. Good schools are something which cannot have secondary consideration.

5 0
3 years ago
What is meant by allocative efficiency? Allocative efficiency is when every good or service A. is produced up to the point where
Alborosie

Answer:

Option (E) is correct.

Explanation:

Allocative efficiency is created when the gap between marginal benefit and marginal cost is maximum. The marginal benefit is the benefit that a consumer can get by consuming an additional unit of a commodity and the marginal cost is the cost that a producer incurred by producing an additional unit.

Hence, the allocative efficiency is achieved where the difference between these two terms is maximized.

5 0
3 years ago
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