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- Stock price: $81 number of shares: 20000 total assets: 6,400,000 total liabilities: 4,000,000 net income: 760,000 cost of investment: $600,000 & will be financed with a new equity issue the ROI = current ROE FIND THE NPVShare Price $ 20.00 EPS $ 3.00 Shares outstanding (million) 10 Book Value $ 25.00 If the company above purchases 1 million shares at $24 what will the book value of the company change to?Q5 The EBIT of the unlevered company is OMR 60,000; cost of equity of unlevered company is 8% and the corporate tax rate is 30%, then what is the value of unlevered company (Vu) under Modigliani-Miller Model? a. OMR 375,000 b. OMR 525,000 c. OMR 275,000 d. OMR 425,000
- A firm's total assets are $95,000,000. 40% of the firm's assets are financed with debt. 25% of the firm's debt is current liabilities. The firm has common stock of $13,400,000. What is the firm's retained earnings balance? O $57,850,000 O $57,000,000 $19,850,000 O $43,600,000Time remaining: 00:09:38 Accounting Compute the costs for each of the sources of financing: i. The retained earnings is RM4.2 million. The price of the common stock is RM48.00 per share, and the expected dividend this coming year should be RM2.80, increasing thereafter at a 5 percent annual growth rate. The corporation’s tax rate is at 29 percent. ii. New common stock issue paid a RM2.66 dividends last year. The company’s dividends per share should continue to increase at a 5 percent growth rate into the indefinite future. The market price of the stock is currently RM48.00, however, flotation costs of RM4.50 per share are expected if the new stock is issued. iii. A preferred stock selling for RM55.00 with an annual dividend payment of RM6.00. The flotation cost will be RM7.50 per share. The company’s marginal tax rate is 29 percent. iv. A RM1,000.00 par value bond with a market price of RM980.00 and a coupon interest rate of 11 percent. Flotation costs for a new issue would be…Task 6. ANGEL Company plans to acquire a processing plant for P40 million. To finance the acquisition, the business will issue 6% preference shares with a par value of P100 per share. The selling price of the preference shares is P150. the business is subject to a 30% income tax rate, and has declared dividends to preference shares of P6 the previous year. Required: Compute the cost of preference share.
- For Rebound Tourism Inc. Per share Price=$40Investment cost for 100 shares=$40×100=$4,000 Please explain answer.50-If the company’s EBIT is OMR 500,000; market value of the equity is OMR 2,000,000 and value of Debt is OMR 4,000,000; then what is the overall cost of capital of the firm under Net Income Approach? a. 8.33% b. 10% c. 12.5% d. 25%You sold short 200 shares of common stock at $60 per share. The initial margin is 60%. Your initial investment was A. $7,200. B. $5,600. C. $4,800. D. $12,000.
- 6. Consider the following balance sheet, for Alara Corporation. Alara has RM700,000 of retained earnings, we know that the company would be able to pay cash to buy an asset with a cost of $300,000. $ 100,000 100,000 $ 200,000 Cash 24 Accounts payable 50,000 200,000 Inventory Accruals Accounts receivable 250,000 Total CL $ 500,000 Long-term debt Common stock Retained earnings Total CA 200,000 200,000 800,000 Net fixed assets - $ 900,000 Total assets $1,400,000 Total L & E $1,400,000 a. True b. False If your answer is false, what is the correct answer: Offline Ca 32°C Ra 84Q47 The Engineering Company currently has 100,000 outstanding stocks selling at OMR 100 each. The firm is also thinking of declaring a dividend of OMR 5 per share at the end of the current fiscal year. The firms opportunity cost of capital is 10%. What will be price of the stock at the end of the year assume that dividend is declared under MM model? a. OMR 105 b. OMR 115 c. OMR 110 d. OMR 1001