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Alecsey [184]
2 years ago
15

Rearden Metal has earnings per share of $2. It has 10 million shares outstanding and is trading at $20 per share. Rearden Metal

is thinking of buying Associated Steel, which has earnings per share of $1.25, 4 million shares outstanding, and a price per share of $15. Rearden Metal will pay for Associated Steel by issuing new shares. There are no expected synergies from the transaction. If Rearden offers an exchange ratio such that, at current pre-announcement share prices for both firms, the offer represents a 20% premium to buy Associated Steel, then the price per share of the Rearden immediately after the announcement will be closest to:
Business
1 answer:
Damm [24]2 years ago
4 0

Answer: $19.12

Explanation:

The price per share of the Rearden immediately after the announcement will be calculated as the addition of the current prices for the companies divided by the total number of shares after merger. This will be:

= (20 × 10) + (15 × 4) / (10 + 3.6)

= (200 + 60) / 13.6

= 260 / 13.6

= 19.12

The price per share is $19.12

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A $1000 bond with a coupon rate of 6.2% paid semiannually has eight years to maturity and a yield to maturity of 8.3%. If intere
ohaa [14]

Answer:

The price of the bond will be $879

Explanation:

Price of the bond is the present value of all cash flows of the bond. Price of the bond is calculated by following formula:

According to given data

Coupon payment = C = $1,000 x 6.2 = $62 annually = $31 semiannually

Number of periods = n = 2 x 8 years = 16 periods

Current Yield = r = 8.3% / 2  = 4.15% semiannually

Price of the Bond = $31 x [ ( 1 - ( 1 + 4.15% )^-16 ) / 4.15% ] + [ $1,000 / ( 1 + 4.15% )^16 ]

Price of the Bond = $31 x [ ( 1 - ( 1 + 0.0415)^-16 ) / 0.0415 ] + [ $1,000 / ( 1 + 0.0415 )^16 ]  

Price of the Bond = $31 x [ ( 1 - ( 1.0415)^-16 ) / 0.0415 ] + [ $1,000 / ( 1.0415 )^16 ]  

Price of the Bond = $521.74 + $357.26   = $879

7 0
3 years ago
Here is the accounting equation for Sam's auto parts $18,000= $12,000 +$6,000 The owner withdrew $1,500 for personal use. Write
Eva8 [605]

Answer:

$18000=$12000+$4500

5 0
3 years ago
Assume that the level of capital flows between the U.S. and the country of Krendo is negligible (close to zero) and will continu
murzikaleks [220]

Answer:

Stronger

Explanation:

Given that inflation affects trade flows, as the higher price of commodities have negative impacts on exports rates. Thus, all things being equal, it is expected that high inflation should cause downward pressure on the exchanger rate of Krendo.

Hence, the inflation effect will be STRONGER than the interest rate effect in influencing the exchanger rate of Krendo against the U.S. dollar.

3 0
3 years ago
Eileen is setting up a company in QuickBooks Online and needs to fill in opening balances for vendors. What is the best way to r
Vsevolod [243]

The best ways is to fill in the opening balance in the vendor details dialogue box. This method is quick, and one may finish it when one create the vendor.

The Vendor Balance Summary report summarizes the company's obligations and overpayments to certain vendors. The overarching goal of this report is to identify accounting irregularities. View the Vendor Balance Detailed report for further information on the vendor's balance.

The following information is included in the report:

  • Vendor: Either the vendor indicated in the preceding filtering choices or all suppliers accessible to the firm.
  • Balance: The amount owed to a certain vendor or the credit/overpayment amount (marked with brackets).
  • Totals: The total amount owed or payed to the suppliers listed.

To learn more about opening balance of vendors click on :

"brainly.com/question/4688609"

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6 0
1 year ago
A company makes $200,000 in a year and has $150,000 in production costs, leaving them with $50,000. The $200,000 represents
NeX [460]

Answer:

The $200,000 represents the revenue and the $50,000 represents the profit.

Explanation:

4 0
2 years ago
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