The banking crisis of 2008 is quite interesting to analyze. The factors that led to this near banking collapse are intriguing to
say the least. In this exercise you will be evaluating the factors that led up to the crisis and determining which ones could have created this scenario.
There is no simple answer to what led to the banking crisis, as there were many factors that contributed over a long period of time. Understanding the factors that led to the crisis is very important, as such an understanding will help regulators prevent similar situations in the future.
Please analyze the factors that are given to determine which ones could have potentially worked together to have created the banking crisis of 2008, and then place each factor in the category of either “Major Contributor” or “Little or No Contribution.”
There is no simple answer to what led to the banking crisis, as there were many factors that contributed over a long period of time. Understanding the factors that led to the crisis is very important, as such an understanding will help regulators prevent similar situations in the future.
Please analyze the factors that are given to determine which ones could have potentially worked together to have created the banking crisis of 2008, and then place each factor in the category of either “Major Contributor” or “Little or No Contribution.”
1 answer:
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Answer:
$28.5
Explanation:
Earnings per share is calculated for Equity shares.
And the treasury stock is not included.
Total equity shares in number = 11,000 - 1,000 (Treasury stock)
= 10,000 shares
Total earnings = $200,000
Further provided that dividend to preference shareholders is paid.
Dividend on preference capital is fixed, that is the rate multiply the par value, dividend is not paid on security premium amount.
Preference dividend = 5,000 $50
6% = $15,000.
The information provided for share issue rates is of no importance of equity, whereas the relevant number provided is important.
Thus earnings after preference dividend = $200,000 - $15,000 = $285,000
Earnings per share = $285,000/10,000 = $28.5 per share.