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zhannawk [14.2K]
3 years ago
15

On January 1, 2021, Red Inc. issued stock options for 250,000 shares to a division manager. The options have an estimated fair v

alue of $7 each. To provide additional incentive for managerial achievement, the options are not exercisable unless divisional revenue increases by 6% in three years. Red initially estimates that it is probable the goal will be achieved. Ignoring taxes, what is compensation expense for 2021
Business
1 answer:
inn [45]3 years ago
3 0

Answer: $583,333

Explanation:

Compensation expense for 2021 = Total compensation / Vesting period

Total compensation:

Assuming the goal given is probable, the total compensation is:

= Number of shares * fair value

= 250,000 * 7

= $1,750,000

Vesting period = number of years goal is to be in effect = 3 years

Compensation expense 2021 = 1,750,000 / 3

= $583,333

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Suppose you invested $93 in the Ishares High Yield Fund (HYG) a month ago. It paid a
blsea [12.9K]

Answer:

B) 0.57%, 1.08%

Explanation:

The computations are shown below:

Dividend yield = (Annual yield) ÷ (market price) × 100

where,

Market price = $94 per share

Annual dividend = $0.53 per share

So, the dividend yield = ($0.53 per share ÷ $94 per share) × 100

= 0.57%

Capital gain yield = (Market price - purchase price) ÷ (purchase price) × 100

                            = ($94 - $93) ÷ ($93) × 100

                            = 1.08%

8 0
3 years ago
. A building owner charges net rent of $20 in the first year, $21 in the second year, and $22 in the third year, but is providin
Anit [1.1K]

Answer: $17.28

Explanation:

6 month free concession in first year drops rent to:

= 20 / 2

= $10

Effective rent = [Present value of Year 1 rent + Present value of Year 2 rent + Present value of Year 3 rent ] / [ 1 - (1 / (1 + rate)^ number of years) / rate]

= [(10 / (1 + 10%) ) + (21 / (1 + 10%)²) + (22 / (1 + 10%)³)] * [1 - (1 / (1 + 10%)³/ 10%)]

= (9.09 + 17.355 + 16.5289) / 2.48685

= $17.28

8 0
3 years ago
In preparing its August 31, 2020 bank reconciliation, Bing Corp. has available the following information:
pav-90 [236]

Answer:

a. $19,800

Explanation:

The computation of the correct cash balance is shown below:

= Balance per bank statement + Deposit in transit - Outstanding checks

= $18,650 + $3,900 - $2,750

= $19,800

We simply added the deposits and deducted the outstanding checks to the bank balance so that the accurate amount can come.

All other information which is given is not relevant. Hence, ignored it

4 0
4 years ago
Free cash flows are a. dividends that have been distributed to shareholders that are taxed as capital gains. b. liquid financial
ch4aika [34]

Answer:

The correct answer is d. liquid financial assets that for tax purposes must be reinvested in the firm if not distributed as dividends to shareholders.

Explanation:

One of the variables that best measure a company's financial capacity is free cash flow (FCF). It consists of the amount of money available to cover debt or distribute dividends, once payment to suppliers and purchases of fixed assets (construction, machinery ...) have been deducted.

In general, this calculation serves to measure the ability of a business to generate cash regardless of its financial structure. That is, the FCF is the cash flow generated by the company that is available to meet payments to its financing providers.

In short, the FCF is the balance of treasury that is free in the company, that is, the money available once the mandatory payments have been met. Normally, the FCF is used to remunerate shareholders via dividends or to amortize the principal of the debt and meet interest.

3 0
3 years ago
At October 1, Arcade Fire Enterprises reported stockholders' equity of $36,000. During October, no stock was issued and the comp
vivado [14]

Answer:

A. $8,000

Explanation:

Stockholders Equity Includes the Add-in-capital par value, Add-in-capital excess value of Common and Preferred, Net income accumulated value and dividends.

Ending Stockholders Equity = Beginning Stockholders Equity + Income for the period - Dividend paid During the period

$32,000 = $36,000 + $4,000 - Dividend paid During the period

$32,000 = $40,000 - Dividend paid During the period

Dividend paid During the period = $40,000 - $32,000

Dividend paid During the period = $8,000

3 0
4 years ago
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