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Georgia [21]
3 years ago
10

Idle Time Gaming, Inc., has reached the point where it needs several million dollars in order to expand and follow its strategic

plan. In negotiations with the investment banker, they agree to issue 40 million shares of common stock, at $22/share. If the investment banker's fee for underwriting the total sale is 6.82%, what is the discounted price that the investment bank is willing to pay Idle Time for the shares
Business
1 answer:
laila [671]3 years ago
7 0

Answer:

The bank is wiling to pay "approximately $820,000,000".

Explanation:

As we know,

Earnings from selling of $22/start sharing $40 million shareholdings:

⇒ 40,000,000\times 22

⇒ $880,000,000

Fee of banker at 6.82% will be:

⇒ 880,000,000\times  0.0682

⇒ $60,016,000

Idle investment company willingness to spend on time will be:

⇒ 880,000,000-60,016,000

⇒ $819,984,000

So that the bank is willing to pay "approximately $820,000,000".

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Therefore I think the answer is Sustainability
Hope it helps
8 0
2 years ago
When preparing a journal entry for a transaction that affects retained earnings, the "Retained Earnings" account should not be d
yarga [219]

Answer:

True

Explanation:

Retained earnings are the net earnings of an entity accumulated over time after payment of dividend. It is that part of earnings that is retain for expansion by the entity.

Generally, retained earnings are not changed by direct posting except it is prior year adjustment. in some entities, the amount that is transferred to retained earnings is system generated. Most transactions that affect retained earnings are debited or credited to account which ultimately affects retained earnings

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3 years ago
Price discrimination is the practice of selling the same good at more than one price when the price differences are not justifie
coldgirl [10]

Answer:

The statement is: True.

Explanation:

Perfectly competitive markets are theoretical markets characterized by having many buyers and sellers, where products are homogeneous, having easy conditions for entry or exit of new firms, and where producers are price-takers because the price is determined by supply and demand.  

In such a scenario, <em>companies could not set different prices such as in a price discrimination approach because consumers would rather go to the competition.</em>

4 0
3 years ago
A government bond with a coupon rate of 8% makes semiannual coupon payments on January 14 and July 14 of each year. The Wall Str
leonid [27]

Answer:

$1003.92

Explanation:

The invoice price is calculated as the reported price plus the accrued interest. Therefore, the formula for accrued interest is shown below:

Accrued Interest =  \frac{Annual coupon payment}{2} * \frac{days since last coupon payment}{days separating coupon payments}

Given that the coupon rate is 8%, therefore the bond pays $80 of coupon payments every year.

January 14 was the day that the last coupon was paid, so it has been 14 days since the last payment.

The coupon period is 182 days.

Therefore, the accrued interest is

= \frac{80}{2} *  \frac{14}{182} \\= 3.297

The invoice price is calculated as:

$1000.625 + $3.297

= $1003.922.

Therefore the invoice price of the bond is $1003.92

8 0
3 years ago
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The answer is:  b. Bank E offers you a chocolate bar for filling out an application for checking and credit at the same time.

When you make examination to determine the type of bank accounts to open , your focus should only be the financial gain that you will obtain from the banks, not small snack that you can buy easily with your money.

You need to focus on finding out which banks would provide more interest rates for your saving, which provide the fastest and reliable services, and which provides more investments opportunities for you.

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3 years ago
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