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AfilCa [17]
3 years ago
9

ASC 480-10 provides guidance on determining whether (1) certain financial instruments with both debt-like and equity-like charac

teristics should be accounted for outside of equity (i.e., as liabilities or, in some cases, assets) by the issuer and (2) SEC registrants should present certain redeemable equity instruments as temporary equity. Examples of contracts and transactions that may require evaluation under ASC 480-10 include:________
Business
1 answer:
Aliun [14]3 years ago
6 0

Answer:

. Redeemable shares.

• Redeemable noncontrolling interests.

• Forward contracts to repurchase own shares.

• Forward contracts to sell redeemable shares.

• Written put options on own stock.

• Warrants (and written call options) on redeemable equity shares.

• Warrants on shares with deemed liquidation provisions.

• Puttable warrants on own stock.

• Equity collars.

• Share-settled debt (this term is used to describe a share-settled obligation that  is not in the legal form of debt but has the same economic payoff profile as debt).

• Preferred shares that are mandatorily convertible into a variable number of common shares.

• Unsettled treasury stock transactions.

• Accelerated share repurchase programs.

• Hybrid equity units.

Explanation:

ASC 480-10 is used when an issuer, in the declaration of its financial position, has to categorize some financial instruments that share the characteristics of liabilities and equities. The issuer always classifies legal-form debt as liability and this makes it not applicable under the ASC 480-10.

Under the ASC 480-10, three types of financial instruments are meant to be classified and they include;

1. Mandatorily redeemable financial instruments

2. Obligations to repurchase the entity’s equity shares by transferring assets, and

3.Certain obligations to issue a variable number of equity shares

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Ben Collins plans to buy a house for $188,000. If the real estate in his area is expected to increase in value by 3 percent each
Sunny_sXe [5.5K]

Answer:

The value after seven years from now is $231,216.29

Explanation:

The computation of the expected value would be seven years from now is shown below:

Here we use the future value formula i.e. shown below:

Future value = Present value × (1 + interest rate)^number of years

= $188,000 × (1 + 0.03)^7

= $188,000 × (1.03)^7

= $231,216.29

Hence, the value after seven years from now is $231,216.29

6 0
3 years ago
Organizations use ________ planning to determine what contributions the departments or work units can make toward the organizati
Nastasia [14]

Organizations use Tactical  planning to determine what contributions the departments or work units can make toward the organization's strategic priorities and policies during the next 6 -- 24 months.

<u>Explanation:</u>

Tactical planning is a precise ascertainment and scheduling of the paramount or short-term pursuits expected in fulfilling the aspirations of strategic planning. The tactical planning manner occurs in real-time, endeavoring short-term consequences. Possessing this methodology in point empowers the company to execute agile tactics to surpass within the corresponding sale.

In the tactical point, the business is reacting to urgent certainties. Tactical planning is abnormally frequent with performance-driven activities. Immobile job positions with recurring responsibilities like recording and making infrequently want a tactical plan because compatible is the most eminent state consequence in these job roles.

7 0
3 years ago
The Higgins Company has just purchased a piece of equipment at a cost of $120,000. This equipment will reduce operating costs by
Maru [420]

Answer:

B. 2.8 years

Explanation:

Initial investment = -120,000+ 8,000 = -112,000

Yr 1 cash inflow = 40,000, hence net CF = 40,000-112,000 = -72,000

Yr 2 cash inflow = 40,000, hence net CF = 40,000- 72,000 = -32,000

Yr 3 cash inflow = 40,000, hence net CF = 40,000-32,000 = 12,000

Payback period = last year with negative net CF + (absolute net CF that year/ total CF the following year)

= 2 + (32,000/40,000)

= 2 + 0.8

= 2.8 years

3 0
3 years ago
LRQ Inc. issued bonds on April 18, 2006. The bonds had a coupon rate of 5.5%, with interest paid semiannually. The face value of
ankoles [38]

Answer:

$857

Explanation:

Price of the bond is the present value of all cash flows of the bond. These cash flows include the coupon payment and the maturity payment of the bond. Both of these cash flows discounted and added to calculate the value of the bond.

According to given data

Face value of the bond is $1,000

Coupon payment = C = $1,000 x 5.5% = $55 annually = $27.5 semiannually

Number of periods = n = (April 18, 2036 - April 18, 2020) years x 2 = 16 x 2 period = 32 periods

Market Rate = 7% annually = 3.5% semiannually

Price of the bond is calculated by following formula:

Price of the Bond = C x [ ( 1 - ( 1 + r )^-n ) / r ] + [ F / ( 1 + r )^n ]

Price of the Bond = 27.5 x [ ( 1 - ( 1 + 3.5% )^-32 ) / 3.5% ] + [ $1,000 / ( 1 + 3.5% )^32 ]

Price of the Bond = $524.29 + $332.59 = $856.98 = $857

8 0
2 years ago
At a price of $200, a cell phone company manufactures 100000 phones. At a price of $300, the company produces 300000 phones. Wha
valkas [14]

Answer:

2.5

Explanation:

P1=$200

P2=$300

S1=100000

S2=300000

The percentage change in price is:

\Delta P =\frac{300-200}{\frac{200+300}{2}}=0.4=40\%

The percentage change in supply is:

\Delta S =\frac{300000-100000}{\frac{100000+300000}{2}}=1=100\%

The price elasticity of supply is given by:

E=\frac{\Delta S}{\Delta P}=\frac{100\%}{40\%}=2.5

The price elasticity of supply is 2.5.

4 0
3 years ago
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