Contract size (in number of shares) Current market value of an ABC Inc. share Exercise price for an ABC Inc. share Exercise price for an ABC Inc. share Volatility Risk-free rate Days in a year 10,000 78.25 76.50 90.00 36% 6% 360
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Topic: Option Pricing
When computing, please do not round off. Only final answers must be rounded off to two decimal places.
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- What is the par value per share? * Mars Corporation recorded the following joumal entry: Land Preference share capital Share premium-preference To record issuance of preference shores @120 Per share. 450,000 420,000 30,0004. An entity showed the following data:Share capital, par value P50 5,000,000Share premium 200,000Retained Earnings 2,000,000Market value of share on declaration date 75Market value of share on distribution date 85Treat each item independently: a. If the entity would declare a 1 for 5 share dividend, what amount would be charged to retained earnings? b. What amount will be credited to share premium if the entity would declare 15% share dividend?Problem 5-7 (IAA) Bronze Company provided the following information at year-end: Share capital Share premium Cumulative translation adjustment - debit Treasury shares, at cost Retained earnings Cumulative unrealized gain on option contract designated as cash flow hedge 6,000,000 3,500,000 2,000,000 700,000 1,500,000 600,000 What is the shareholders' equity at year-end? a. 9,500,000 b. 8,900,000 c. 7,400,000 d. 7,500,000
- What is the total amount of share premium to be reported by the surviving company?a. P1,000,000 c. P1,750,000b. P944,600 d. P1,400,000purchased for P120 per Problem 16-14 (AICPA trading. These 50,000 shares were rights to the investor. and two of these rights. Each share had a market value of P130 and each right had market value of P20 on the date of issue. a What total cost should be'recorded for the new shares that are acquired by exercising the rights? a. 2,250,000 b. 3,250,000 c. 3,050,000 d. 5,500,000State with reason whether a company can issue a share having a face value of $20 at $17.
- 2. The cost and fair value of trading securities held by Moneyman as of December 31 are as follows: Laurie Inc. Scott Corp. Stephannie Company Timmer Company Total Name Required: Number of Shares 1,200 600 900 1,400 Fair Value Cost Total per per Total Fair Share Share Cost Value $10.50 $11.05 9.00 9.85 4.10 4.00 7.35 6.82 a. Complete the table above to find the total cost and fair value for Moneyman's trading securities portfolio. b. Calculate and record the required December 31 adjustment c. Explain how the adjustment from part (b) is reported on Moneyman's financial statements4. An entity showed the following data:Share capital, par value P50 5,000,000Share premium 200,000Retained Earnings 2,000,000Market value of share on declaration date 75Market value of share on distribution date 85Treat each item independently: c. How much would be the total shareholders’ equity after a 10% share dividend declaration? d. If the entity would declare a 1 for 5 share split, What would be the balance of retained earnings?Topic: REVENUE FROM CONTRACTS WITH CUSTOMERS Requirement: Compute for the transaction price. Assume that the quoted price of the shares remained constant at P20 all throughout the year.
- Consider the financial statements for the REIT given below. Assume that the net revenue includes a loss of $4,000,000 on an asset sale. This REIT has issued 1,000,000 shares. Similar REITs are trading at FFO multiples of 10x. What valuation (share price) does this information imply for the REIT? Net Revenue Less: Less: Interest expense Net income O 49.2 O 129.2 O 95.2 89.2 Operating expenses Depreciation and amortization Income from operations $20,000,000 9,800,000 4,400,000 5,800,000 $ 1,280,000 $ 4,520,000Particulars No. of equity shares Profit after tax Market Price Per Share Compute the following: i) EPS of both the companies ii) Exchange Ratio Infinity Limited 6,00,000 $20,00,000 $20 Global Limited 2,00,000 $10,00,000 $15Use the method of comparable to calculate the value per share for company B. the below table shows us sales, earning, book value, and share capital Sales Earning Book value Share Capital Company A 22160 1952 16123 6050 Company B 26951 4262 12045 4744 Company C 306058 18396 72461 8970 The below table shows share price and par value for companies Company A Company B Company C Share price 0.470 ??? 2.190 Par value 0.100 1.000 0.100
