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3 years ago

Stated value of no-par stock is:

Business

2 answers:

Nitella [24]3 years ago

6 0

Answer:

C. The market value of the stock on the date of issuance.

Explanation:

No-par stocks do not have any par value printed on them.This helps companies avoid the theoretical liability for if the stock falls below the par value. When there is no par value of stock, investors pay what they think is the right price according to cash flows and profitability of the issuing company, thus no-par stocks carry a market value as associated with it by the investors.

Hope that helps.

sdas [7]3 years ago

5 0

Answer: The correct answer is "e. An amount assigned to no-par stock by the corporation's board of directors.".

Explanation: Stated value of no-par stock is: An amount assigned to no-par stock by the corporation's board of directors.

The board of directors of the corporation are those who designate a declared value for no-par stock.

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West Corp. issued 15-year bonds two years ago at a coupon rate of 7.3 percent. The bonds make semiannual payments. If these bond

MaRussiya [10]

Answer:

7.44 %

Explanation:

The Yield to Maturity (YTM) is the Interest rate that makes the Present Value of Coupons and Principle equal the Market Price or Current Price of the Bond.

The Yield to Maturity can be calculated using a financial calculator as follows :

PV = - $100

N = (15 -2) × 2 = 26

PMT = ($100 × 7.30%) ÷ 2 = $3.65

FV = $103

P/YR = 2

YTM = ?

Therefore, Inputting the values in the calculator as shown gives the Yield to Maturity is 7.44 %.

7 0

3 years ago

Consider a firm with an EBIT of $500,000. The firm finances its assets with $2,000,000 debt (costing 6 percent) and 50,000 share

Schach [20]

Answer:

EPS is reduced by $1.92 and 42%

Explanation:

EBIT $500,000

Interest Expense ($120,000) ($2,000,000 x 6%)

EBT $380,000

Tax 40% ($152,000)

Net Earninig $228,000

Outstanding stock = 50,000

EPS = $228,000 / 50,000 = $4.56 per share

Change in Capital Structure.

EBIT $500,000

Interest Expense ($60,000) ($1,000,000 x 6%)

EBT $440,000

Tax 40% ($176,000)

Net Earninig $264,000

Outstanding stock = 50,000 + 50,000 = 100,000

EPS = $264,000 / 100,000 = $2.64 per share

Change in EPS = $4.56 - $2.64 = $1.92 per share

Change in EPS = $1.92 / $4.56 = 0.42 = 42%

5 0

3 years ago

Lyman’s business has grown to 400 employees with annual revenues of $15 million. He would like to expand further but needs anoth

muminat

There are options available for Lyman :

Either he
- Sell his equity to his investors, ( which mean that he have to give away a percentage of his company)
- Or he can get some Loans

I he should consider Loans, because his annual revenues already way higher than the amount of loans that he need, he could easily paid it off

7 0

3 years ago

Suppose the U.S. and Japan both produce airplanes and televisions and the U.S. has a comparative advantage in the production of

EastWind [94]

Answer:

d. both countries, as whole, will be better off.

Explanation:

When countries leverage on their comparative advantages, they will be better off. In this instance as US has comparative advantage in producing airplanes, it will be more cost effective for them to produce and export to Japan.

So also Japan will find it cheaper to produce televisions and export to the US. Both contries reduce cost by producing goods they have comparative advantage in.

6 0

3 years ago

.Grannis Corporation purchased land in order to construct a new factory . Expenditures incurred by the company were as follows:

katovenus [111]

Answer:

The amount recorded in the Land account is $61,200

Explanation:

The cost of acquisition/purchase of a landed asset includes all the normal, reasonable and necessary costs incurred in obtaining the land and getting it ready for use. These cost includes the price of the land, the legal fees, title fees, taxes, excavation costs etc. On the other hand, cost of improvements on the land are recorded on improvement on asset accounts, where depreciation is put in consideration when computing cost. This is separate from acquisition cost because, there is no depreciation on a land. The cost is calculated as follows:

purchase price = $ 45,000

broker's fees = $ 8,000

accrued taxes = $ 2,000

demolition = $ 2,700

grading = $ 1,500

excavation = $ 2,000

Total = $ 61,200

6 0

3 years ago