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You own shares of Somner Resources' preferred stock, which currently sells for per share and pays annual dividends of $ per s

dimulka [17.4K]

Answer:

You should buy more shares

Explanation:

The above-mentioned question is missing few components. I have added them to explain on how the question would be solved if all the variables were provided. Please note the additions in bold text below. The answer of which is given afterwards.

You own 300 shares of Somner Resources' preferred stock, which currently sells for $39 per share and pays annual dividends of $5.50 per share. If the market's required yield on similar shares 12% is percent, should you sell your shares or buy more?

Solution as mentioned below:

First of all we need to calculate value of the preferred stock by dividing the annual dividend per share from the market required rate.

Value of preferred stock = 5.50 / 12%

Value of preferred stock = $45.83

Now given the fact that the current price at which the stocks are sold is $39 which is less than the price at which they are actually valued which is $45.83. You should buy more of the shares as they are currently undervalued.

8 0

3 years ago

Suppose autos cost consumers $30,000 and trucks cost consumers $15,000. What contribution does the production of 200 autos and 2

alexgriva [62]

Answer:

the contribution made to the production of 200 autos and 200 trucks is $9,000,000

Explanation:

The computation of the contribution made to the production of 200 autos and 200 trucks is shown below

Contribution to GDP is

= $30,000 × 200 + $15,000 × 200

= $6,000,000 + $3,000,000

= $9,000,000

Hence, the contribution made to the production of 200 autos and 200 trucks is $9,000,000

6 0

3 years ago

The simple case of a fixed per-unit tax is indicative of more complicated ones. consider a proportional sales tax and a progress

mars1129 [50]

The tax revenues and quantities produced compare in these various cases in a way of the said proportional tax. The proportional tax is a type of tax processes and system that need the percentage of equal value and it came from the people who pay tax.

8 0

3 years ago

Carter Industries has two divisions: the West Division and the East Division. Information relating to the divisions for the year

anyanavicka [17]

Answer:

$81,000

Explanation:

Segment margin is derived by deducting all expenses that are directly traceable to the segment and it does not include corporate common expenses.

Particulars Amount

Contribution $132,000 [33,000*(8-4)]

Less: Direct fixed cost ($51,000)

Segment Margin $81,000

So, Carter's segment margin for the West Division is $81,000.

8 0

3 years ago

Cody Jenkins and Lacey Tanner formed a partnership to provide landscaping services. Jenkins and Tanner shared profits and losses

Artyom0805 [142]

Answer:

A) 10,200

Explanation:

Capital balance of both partners :

Cody Jenkins = $39,000

Lacey Tanner = $51,000

Existing capital =. $(39,000 + 51,000) = $90,000

New purchase price - Solano = $24,000

Total capital = $(90,000 + 24000) = $114,000

New capital :

New partner share × total capital

New partner capital = 30 % × 114000 = $34,200

Amount of partner bonus = new purchase price - new partner capital

Amount of partner bonus = 24,000 - 34,200 = - $10,200

Bonus share ratio:

Cody Jenkins and Lacey Tanner share profit and losses equally :

Cody Jenkins and Lacey Tanner :

0.5 × 10,200 = -$5,100

B)

Account. - - - - - - - - - - - - - Debit - - - - - Credit

Cash - - - - - - - - - - - - - - - 24,000

Capital: valerio Solano - - - - - - - - - - - 34,200

Capital: Cody Jenkins - - - 5,100

Capital: Lacey Tanner - - - 5,100

Total - - - - - - - - - - - - - - - 34,200 - - - 34,200

C.)

The purchase price is less than the book value of the 30% percentage of the partnership purchase, valerio Solano purchase price was $24,000 but he was allocated 30% of total capital which is $34,200

4 0

3 years ago