Question

The owners' equity accounts for Buel Industries include common stock of $16,000 with a $1 par...

The owners' equity accounts for Buel Industries include common stock of $16,000 with a $1 par value, capital surplus of $174,000, and retained earnings of $568,500. How many shares will be outstanding and what will be the par value per share if the firm declares a 2-for-5 reverse stock split? A. 5,200; $3.33 B. 5,333; $3.33 C. 40,000; $0.40 D. 6,400; $2.50

The Turtle Cave currently has 160,000 shares of stock outstanding that sell for $67.20 per share. Assume no market imperfections or tax effects exist. What will be the new share price if the firm declares a stock dividend of 10 percent? A. $61.09 B. $74.67 C. $60.48 D. $73.92

On July 9, you purchased 750 shares of Blue Water stock for $32 a share. On August 4, you sold 150 shares of this stock for $33 a share. You sold an additional 100 shares on August 14 at a price of $34.50 a share. The company declared a dividend of $.76 per share on August 3 to holders of record as of Monday, August 17. This dividend is payable on September 15. How much dividend income will you receive on September 15? A. $380 B. $570 C. $456 D. $494

Grocery Express stock is selling for $66 a share. A three-month, $60 call on this stock is priced at $7.92. Risk-free assets are currently returning .2 percent per month. What is the price of a three-month put on Grocery Express stock with a strike price of $60? A. $1.56 B. $2.33 C. $1.91 D. $2.78

Della's Pools has 36,000 shares of stock outstanding with a par value of $1 per share and a market price of $26 a share. The firm just announced a 5-for-3 stock split. How many shares of stock will be outstanding after the split? A. 54,000 shares B. 36,000 shares C. 60,000 shares D. 21,600 shares

According to put-call parity, the present value of the exercise price is equal to the: A. Stock price minus the put premium minus the call premium. B. Stock price plus the call premium minus the put premium. C. Put premium plus the call premium minus the stock price. D. Stock price plus the put premium minus the call premium.

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

Value of Common Equity = $ 16000 and Par Value = P = $ 1

Therefore, number of common equity outstanding = 16000 / 1 = 16000

A reverse stock split implies a situation wherein a company merges existing common stock to create a more valuable (in terms of the stock's par value) common stock. In this case, every 5 existing common stock would be exchanged for 2 new common stock of the firm, under a 2 for 5 reverse stock split.

Therefore, number of new common stock = 16000 x (2/5) = 6400

New Par Value of Common Stock = 16000 / 6400 = $ 2.5 per share

Hence, the correct option is (D).

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
The owners' equity accounts for Vidi International are shown here:      Common stock ($.50 par value)...
The owners' equity accounts for Vidi International are shown here:      Common stock ($.50 par value) $ 35,000   Capital surplus 320,000   Retained earnings 708,120      Total owners’ equity $ 1,063,120 If the company declares a five-for-one stock split, how many shares are outstanding now? What is the new par value per share? If the company declares a one-for-seven reverse stock split, how many shares are outstanding now? What is the new par value per share?
The owners' equity accounts for Vidi International are shown here:   Common stock ($.60 par value) $...
The owners' equity accounts for Vidi International are shown here:   Common stock ($.60 par value) $ 45,000   Capital surplus 365,000   Retained earnings 798,120      Total owners’ equity $ 1,208,120    a-1. If the company declares a three-for-one stock split, how many shares are outstanding now? (Do not round intermediate calculations.) a-2. What is the new par value per share? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) b-1. If the company declares a one-for-four...
The owners' equity accounts for Vidi International are shown here:      Common stock ($.50 par value)...
The owners' equity accounts for Vidi International are shown here:      Common stock ($.50 par value) $ 42,500   Capital surplus 345,000   Retained earnings 758,120      Total owners’ equity $ 1,145,620    a-1. If the company declares a two-for-one stock split, how many shares are outstanding now? (Do not round intermediate calculations.) a-2. What is the new par value per share? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) b-1. If the company declares a...
The owners' equity accounts for Vidi International are shown here:      Common stock ($.50 par value)...
The owners' equity accounts for Vidi International are shown here:      Common stock ($.50 par value) $ 46,000   Capital surplus 380,000   Retained earnings 828,120      Total owners’ equity $ 1,254,120    a-1. If the company declares a four-for-one stock split, how many shares are outstanding now? (Do not round intermediate calculations.) a-2. What is the new par value per share? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) b-1. If the company declares a...
The owners' equity accounts for Vidi International are shown here:      Common stock ($.60 par value)...
The owners' equity accounts for Vidi International are shown here:      Common stock ($.60 par value) $ 37,500   Capital surplus 325,000   Retained earnings 718,120      Total owners’ equity $ 1,080,620    a-1. If the company declares a two-for-one stock split, how many shares are outstanding now? (Do not round intermediate calculations.) a-2. What is the new par value per share? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) b-1. If the company declares a...
Answer all parts The owners’ equity accounts for Overby International are shown here: Common stock ($1...
Answer all parts The owners’ equity accounts for Overby International are shown here: Common stock ($1 par value) $ 45,000 Capital surplus 236,000 Retained earnings 780,000 Total owners’ equity $ 1,061,000 a. Suppose the company declares a two-for-one stock split. How many shares are outstanding now? (Do not round intermediate calculations and round your answer to the nearest whole number, e.g., 32.) New shares outstanding _______? What is the new par value per share? (Do not round intermediate calculations and...
Growth​ Industries' current​ stockholders' equity account is as​ follows: a.  Indicate the change in par value...
Growth​ Industries' current​ stockholders' equity account is as​ follows: a.  Indicate the change in par value and the number of shares outstanding if the firm declares a ​2-for-1 stock split. b.  Indicate the​ change, in par value and the number of shares outstanding if the firm declares a 1-for-1​½ reverse stock split.   c.  Indicate the change in par value and the number of shares outstanding if the firm declares a ​3-for-1 stock split. d.  Indicate the change in par value...
S17-03 Stock Splits [LO3] The owners’ equity accounts for Vidi International are shown here   Common stock...
S17-03 Stock Splits [LO3] The owners’ equity accounts for Vidi International are shown here   Common stock ($.50 par value) $ 25,000   Capital surplus 215,000   Retained earnings 642,700      Total owners’ equity $ 882,700 a-1. If the company declares a four-for-one stock split, how many shares are outstanding now? (Do not round intermediate calculations.) a-2. What is the new par value per share? (Do not round intermediate calculations and round your answer to 3 decimal places, e.g., 32.161.) b-1. If the company...
On December 20, 2018, A company had the following shares outstanding: Preferred stock (6%, $30 par)...
On December 20, 2018, A company had the following shares outstanding: Preferred stock (6%, $30 par) 1,000,000 shares Common stock ($2 par) 10,000,000 shares Journalize the following transactions and events from 2019: (a) January 10: the company purchased 500,000 shares of its common stock at a market price $24 per share. (b) March 4: the company declares a dividend on preferred stock of $3.00 per share. The record date is March 8th and the date of payment is April 1st....
On June 30, Sharper Corporation’s common stock is priced at $26.00 per share before any stock...
On June 30, Sharper Corporation’s common stock is priced at $26.00 per share before any stock dividend or split, and the stockholders’ equity section of its balance sheet appears as follows. Common stock—$6 par value, 90,000 shares authorized, 36,000 shares issued and outstanding $ 216,000 Paid-in capital in excess of par value, common stock 100,000 Retained earnings 316,000 Total stockholders’ equity $ 632,000 1. Assume that the company declares and immediately distributes a 100% stock dividend. This event is recorded...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT