1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
Fynjy0 [20]
3 years ago
8

The following data apply to Garber Industries, Inc. (GII): Value of operations $1,000 Short-term investments $100 Debt $300 Numb

er of shares 100 The company plans on distributing $100 as dividend payments. What will the intrinsic per share stock price be immediately after the distribution? a. $7.72 b. $6.32 c. $7.00 d. $7.35 e. $6.65
Business
1 answer:
kari74 [83]3 years ago
5 0

Answer:

The correct option is $7,option C

Explanation:

The approach here is that we calculate the value of the firm after the cash dividend distribution ,which is simply the value of operations of $1000 since the short-term investments of $100 has been used in paying dividends.

Thereafter,the value of equity is the value of operations of $1000 minus the value of debt at $300,that is $700 ($1000-$300).

Finally intrinsic share price=value of equity/number of shares

number of shares is 100

intrinsic value per share=$700/100=$7 per share

You might be interested in
At year​ end, Tangshan China Company balance sheet showed total assets of​ $60 million, total liabilities​ (including preferred​
Studentka2010 [4]

Answer:

Earnings per share

= <u>Net income - Preferred dividend </u>

  No of common stocks outstanding

= <u>$1,500,000 - 0</u>

   1,000,000 shares

= $1.50 per share

P/E ratio = <u>Market price per share</u>

                 Earnings per share

15   = <u>Market price per share</u>

              $1.50

Market price per share = 15 x $1.50

                                      = $22.50

Explanation:

In this question, there is need to calculate earnings per share by dividing net income by number of common stocks outstanding. Thereafter, we will apply P/E ratio formula, where P/E ratio and earnings per share are known. We will make market price per share the subject of the formula.

7 0
2 years ago
Millions of software programs have been created and have helped to improve the economy.
tester [92]

Where is the question? Thanks.

4 0
3 years ago
When is it okay to time out<br> someone? In Twitch
VARVARA [1.3K]
When that person spams I guess
3 0
2 years ago
The argument for import protection in developing countries to bring about industrialization differs from the infant-industry arg
Zigmanuir [339]

Answer:

D) it presumes there will be economic gains even if output does not become internationally competitive

Explanation:

The argument for import protection in developing countries to bring about industrialization differs from the infant-industry argument in that it presumes there will be economic gains even if the output does not become internationally competitive. International competitiveness is a step of the relative cost of services/goods from a nation. Countries that can provide a similar quality of goods at a cheaper cost are stated to be extra competitive.

4 0
2 years ago
Studying business ethics will not necessarily
Serga [27]

Business ethics will never tell you exactly what to do in all decisions. The study of business ethics is designed to help you understand the importance of your decisions, inform you of impacts, describe the ethical decision-making process, and help you recognize ethical issues, but it will not tell you what to do. It will simply give you the tools necessary to make a decision.

7 0
3 years ago
Other questions:
  • If you were in charge of developing a tax system for a country, how would you structure taxes? For example, who should pay the g
    9·1 answer
  • Select all the correct answers.
    8·2 answers
  • From the textbook material, when all activities of the value chain are conducted within the boundaries of the firm, the firm is
    5·1 answer
  • Several firms are operating in a market where they take the other firms' response to their actions into account. This market is
    6·1 answer
  • If your income increases by $1,500 and you only consume $900 of it, your marginal propensity to consume would be equal to: a. 0.
    6·1 answer
  • Arney has been retained by Fluffy Soft Programmers to hire a new worker because he is an expert at personality types and their e
    10·1 answer
  • 9.
    6·1 answer
  • ​________ is the second step in the target marketing process. in this​ step, marketers evaluate segments and decide which segmen
    5·1 answer
  • The Commissioner is empowered to examine the records of any person transacting insurance in the State as an agency, an agent or
    15·1 answer
  • Where do most banks get the text to explain their calculations of interest?
    10·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!