All categories

3 years ago

Consider the following premerger information about Firm X and Firm Y:

Business

1 answer:

umka21 [38]3 years ago

5 0

Answer:

Firm X and Firm Y

Post-merger Balance Sheet for Firm X

Net assets $886,000

Goodwill 90,000

Total assets $976,000

Common stock $742,000

Long-term debt 234,000

Total liabilities and

equity $976,000

Explanation:

a) Data and Calculations:

Firm X Firm Y

Total earnings $96,000 $22,500

Shares outstanding 53,000 18,000

Per-share values:

Market $53 $18

Book $14 $8

Net assets $742,000 $144,000

= (53,000*$14) (18,000*$8)

Net assets = Common Stock for each company

Merger premium on Firm Y $5

Goodwill on acquisition = $90,000 (18,000 * $5)

Investment in Firm Y = $234,000 (18,000 * ($8 + $5)

Long-term debt issued = $234,000

Net assets

Firm X net assets before acquisition = $742,000

Firm Y net assets before acquisition = 144,000

Net value of combined assets = $886,000

You might be interested in

At the beginning of the month, you owned $8,000 of General Dynamics, $7,000 of Starbucks, and $5,000 of Nike. The monthly return

guajiro [1.7K]

Answer:

= $406.6

Explanation:

To calculate return of portfolio we first calculate weight of each asset

this can be done by finding total investment and then dividing each asset by total investment.

Total investment = 8000 + 7000 + 5000 = $20,000

General Dynamics 8000/20000 = 0.4 = W1

Starbucks 7000/20000 = 0.35 = W2

Nike 5000/20000 = 0.25 = W3

Now for portfolio return we can use the formula

P(r) = W1 * (Return on W1 asset) + W2 * (Return on W2 asset) + W3 * (Return on W3 asset)

So,

P(r) = 0.4 * (0.0680) + 0.35 * (-0.0152) + 0.25 * (-0.0062)

This gives us

Total Return % = 0.02033 or 2.033%

Simply multiply this cumulative weight to total portfolio worth

Total Return in $ = 0.02033 * 20000 = $406.6

Hope that helps.

8 0

3 years ago

Scott Bennett is preparing his balance sheet and income and expense statement for the year ending June 30, 2016. He is having di

dybincka [34]

Answer:

a. Expense

b. Expense and Liability

c. Assets and Liability

d. Expense and Liability

e. Expense and Asset

f. Assets

Explanation:

Assets are resources held or controlled by the entity as a results of a past event, for which future economic benefits are expected to flow to the entity, liabilities are present obligations of an entity as a result of a past event for which future economic benefits would flow out of the entity. Income and expense are elements of the income statements while the assets and liabilities are elements of balance sheet along with equities. Considering the lines

a. Scott rents a house for $1,350 a month - This is an expense except for when paid for in advance then it becomes an asset.

b. On June 21, 2016, Scott bought diamond earrings for his wife and charged them using his MasterCard. The earrings cost $900, but he hasn’t yet received the bill. - This represents both expense and a liability as he is yet to receive the bill.

c. Scott borrowed $3,500 from his parents last fall, but so far, he has made no payments to them. - This is an asset (cash) and a liability since he is yet to pay.

d. Scott makes monthly payments of $225 on an installment loan; about half of it is interest, and the balance is repayment of principal. He has 20 payments left, totaling $4,500 - The interest element is an expense while the amount left is a liability

e. Scott paid $3,800 in taxes during the year and is due a tax refund of $650, which he hasn’t yet received. - The amount paid in taxes is an expense while the amount to be received back is an asset

f. Scott invested $2,300 in some common stock - This is an assets

5 0

3 years ago

The goal of brand positioning is to explain why one brand is different and better for its target customers, and why the differen

Andrei [34K]

Answer:

True

Explanation:

Brand positioning refers to creating and occupying a place in a prospective customer's mind with respect to a brand. It refers to a brand image created in the minds of prospective customers whenever they think of a brand.

For instance, when a customer thinks of Lacoste, it reminds him of the quality associated with it along with it's French connect.

Brand positioning helps an enterprise distinguish it's own brand from those of the competitors. Also, such an exercise reveals uniqueness of the brand i.e attributes specific of such a brand.

4 0

3 years ago

Stocks X and Y have the following data. Assuming the stock market is efficient and the stocks are in equilibrium, which of the f

s344n2d4d5 [400]

Answer:

b. Stock Y has a higher dividend yield than Stock X

Explanation:

Hope it helped...Please mark brainliest. Have a nice day!

7 0

4 years ago

Elliot is suing Acme, Inc., for a breach of contract, but because Acme has very little in assets, he asks the court to pierce th

Sergeu [11.5K]

Answer: The court would likely approve Elliot's request in the following situation: The corporation was under-capitalized from the beginning, and never had sufficient assets to operate as a viable business.

Under the given scenario i.e. for a breach of contract , the condition will apply if the corporation i.e. Acme Inc. was under-capitalized from the start, and they never had predominating assets to work as a viable organization.

Therefore the correct option is (a)

7 0

3 years ago