Company A considers buying company B by means of a tender offer. Company B will accept any offer of A which reflects a fair value (namely, any offer which is not below the expected value of the project to B, given B's information). Company B is currently undertaking a major project. If the project is a complete failure the fair value of each share of B will be $60, and if it's a complete success the fair value of a share will be $120. The outcome of the project can vary from a complete failure to a complete success, and all outcomes are equally likely. That is, the fair value of a share of B can be any number between 60 and 120 equally likely. The management of A is significantly more skillful than that of B. Under the management of A the share price of B will be $20 higher than under the current management of B. Assume that the offer of A is made before the outcome of the project is known, but B will decide to accept or reject after the outcome is announced. What should A offer B in terms of a price per share

Answers

Answer 1

Answer:

the price per share in the case when A offers B is $200

Explanation:

The computation of the price per share is as follows:

The fair value is

= ($60 + $120) × 50%

= $90

The 50% represent the percentage of equally

Now the price per share is

= $90 + $90 + $20

= $90 + $110

= $200

Hence, the price per share in the case when A offers B is $200

The same is to be considered


Related Questions

______ occurs when an employee or an applicant is treated unfairly at work or in the job hiring process due to an identity group, condition, or personal characteristic.

Answers

Answer:

Workplace discrimination.

Explanation:

Workplace discrimination is an extremely negative situation that occurs due to certain characteristics of an individual. It may occur because the individual belongs to different ethnic groups, depending on nationality, color, religion, etc.

This situation is harmful to the organization as a whole, the discriminated individual is the one who suffers the most for having their equality rights violated and for feeling coerced and disrespected in a work environment that should be supported by criteria of equality, ethics and collaboration .

It is necessary for companies to be aware of possible loopholes in their policies that may corroborate with such illegal acts, revising them whenever necessary and strengthening the values ​​of respect for personal individualities and equality among employees.

Gore Inc. sells office furniture. In 2021, it sold 200 desks for $500 each. For each desk sold, Gore distributed a 50% discount coupon for purchase of an office chair within one month. Based on historical experience, Gore expects that approximately 20% of the coupons will be utilized. The chairs purchased with the coupons are priced at $150 and normally discounted 10%. What would be the stand-alone sales price used by Gore for the coupon when allocating the $500 transaction price to performance obligations

Answers

Answer:

$12

Explanation:

Stand alone sale price = (Cost of chair) * (Discount % of voucher-Normal% of discount) * (% of coupons to be utilized)

Stand alone sale price = $150 * (50%-10%) * 20%

Stand alone sale price = $150 * 40% * 20%

Stand alone sale price = $12

Therefore, the Stand alone selling price used by Gore Inc. is $12

5 poin
What do we call an interest-bearing account at a bank that pays a higher
interest rate than a regular savings account? *
Checking Account
Stocks
Money market
None of the above

PLEASEEE

Answers

Answer:

Money market account

Explanation:

Money market deposit account  MMDA are high earning saving accounts offered by banks and credit unions.  Financial institutions require a minimum amount to open an MMDA account. Customers are also required to maintain a specified balance in their accounts at all times. Withdrawals from money market deposit accounts are restricted.

Money market account pays a higher interest because financial institutions use the deposit from these accounts to invest in short-term money market securities. Examples of Money market securities include commercial papers, certificates of deposits, and treasury bills. They often offer high returns. The interest rates offered on MMDA is influenced by the interest earned on the money market securities.

When an organization defines itself and its niche in an environment by the choice of what sector or field of the environment it will use its technology, products, and services to compete in and serve, it is describing its ______.

Answers

Answer:

Domain

Explanation:

It should be noted that When an organization defines itself and its niche in an environment by the choice of what sector or field of the environment it will use its technology, products, and services to compete in and serve, it is describing its Domain. Domain can be regarded as the chosen field of action for an organization/company, it encompass the part of the environment chosen by the organization which is vital to the organization, it involves the chosen niche of the organization in the environment.

Forest Gump drinks Dr. Pepper. He can buy as many cans of Dr. Pepper as he wishes at a price of $0.50 per can. On a particular day, he is willing to pay $1.00 for the first can, $0.75 for the second can, $0.60 for the third can, and $0.40 for the fourth can. Assume Forest Gump is rational in deciding how many cans to buy. His consumer surplus is

Answers

Answer:

0.85

Explanation:

1-0.50 = 0.50

0.75-0.50 = 0.25

0.60-0.50 = 0.10

0.50+0.25+0.10

= 0.85

Computer equipment was acquired at the beginning of the year at a cost of $65,000 that has an estimated residual value of $3,800 and an estimated useful life of 8 years. (1)Determine the (a) depreciable cost for straight rate, (b) straight-line rate, and (c) annual depreciation for the straight line rate (d) double declining balance depreciation amount for 1st year (2) Journalize the sale of the equipment at the end of the 4th year for $20,000 cash, if using the straight line rate.

Answers

Answer:

a) Depreciable cost = $61,200

b) Straight-line rate = 12.5%

c) Annual depreciation for the straight-line rate is:

$7,650.

d) The double-declining balance depreciation amount for the 1st year is:

$15,300.

e) Journal Entry of sale of equipment at the end of the 4th year for $20,000, using the straight-line rate:

Debit Sale of Equipment $65,000

Credit Equipment $65,000

To record the transfer of the equipment account.

Debit Accumulated Depreciation $30,600

Credit Sale of Equipment $30,600

To record the transfer of accumulated depreciation to the account.

Debit Cash Account $20,000

Credit Sale of Equipment $20,000

To record the cash received from the sale.

Debit Profit and Loss Account $14,400

Credit Sales of Equipment $14,400

To record the loss on sale of equipment.

Explanation:

a) Data and Calculations:

Cost of computer equipment = $65,000

Estimated residual value =             3,800

Depreciable value =                   $61,200

Estimated useful life = 8 years

Annual depreciation expense = $7,650 ($61,200/8) or $61,200 * 12.5%

Depreciable cost = $61,200 ($65,000 - $3,800)

Straight-line rate = 12.5% (100%/8)

Double-declining rate = 12.5% x 2 = 25%

Depreciation amount for the 1st year = $15,300 ($61,200 * 25%)

Book value of asset at the end of the 4th year, straight-line method:

Cost of equipment = $65,000

Accumulated Depreciation = $30,600 ($7,650 * 4)

Book value = $34,400

Sales proceed = $20,000

Loss on sale of asset = $14,400 ($34,400 - $20,000)

a landscape archetiect is hired to build a garden which is of the shape of a right traingle. suppose the architech wants to use a brick wall on the side of AC costing $9/ft and a metal fence on the side costing $3/ft suppose the architect has $1620 budget. what is the maxmum area the architect can build with he budget

Answers

Answer:

Maximum Ares architect can build is 36,450 [tex]ft^{2}[/tex]

Explanation:

Suppose

The Perpendicular of the triangle = l

The Base of the triangle = b

The hypotenuse of the triangle = h

The hypotenuse of the triangle can be calculated as follow

h = [tex]\sqrt{l^{2} b^{2} }[/tex]

Total Budget = $1,620

As the architect does not want to build anything on the hypotenuse of the triangle area.

So as per given condition

( $9 x l ) + ( $3 x b ) = $1,620

$3 ( 3l + b ) = $1,620

3l + b = $1,620 / $3

3l + b = 540

b = 540 - 3l ...........(1)

Area = 1/2 x l x b

using (1) we will have

Area = 1/2 x l x ($540 - 3l)

Now differentiating w.r.t l

[tex]\frac{d(area)}{dl}[/tex] = [tex]\frac{\frac{1}{2} [ 540l - 3l^{2}] }{dl}[/tex]

0 =  [tex]\frac{1}{2} [ 540 - 6l] }[/tex]

0 = 540 - 6l

6l = 540

l = 540/6

l = 90 ft

Placing value of l in (1)

b = 540 - 3(90)

b = 540 - 270

b = 270

So, Maximum area will be calculated as follow

Maximum Ares = [tex]\frac{1}{2}[/tex] x 270 x 270

Maximum Ares = 36,450 [tex]ft^{2}[/tex]

g 2018: US Bond A is issued at par with annual coupon of 2% and maturity of 5 years with face value of $1,000. 2019: Interest rates increase in the market 2020: US Bond B is issued at par today with annual coupon of 5% and a maturity of 3 years with face value of $1,000.What should the price of Bond A be today, 2020, with 3 years left to maturity, so that its yield to maturity is equal to the yield to maturity on Bond B

Answers

Answer:

$918.48

Explanation:

price of bond A after the interest rate increased to 5% and the time to maturity is 3 years:

PV of face value = $1,000 / (1 + 5%)³ = $863.84

PV of coupon payments = $20 x 2.7232 (PV annuity factor, 5%, 3 periods) = $54.46

Market value of bond A = $863.84 + $54.46 = $918.48

Since the market rate is higher than the coupon rate, the bond will sell at a discount.

The median price of existing homes: ___________

a. has increased over the past 30 years, thereby acting as a hedge against inflation.
b. has risen less than the Consumer Price Index.
c. always increases in value.
d. tends to be countercyclical, thereby acting as a hedge against the business cycle.
e. remains constant over time.

Answers

Answer:

C

Explanation:

The median price of existing homes always increases in value. This is so because as the year goes on, there is an ever increasing need for shelter. Because of the fact that people procreate and more people are living, there is the certain need, or say, demand for shelter. And as a result of this, there doesn't seem to be a decline in the demand, and most likely wouldn't be anytime soon either.

Pfizer Inc., a pharmaceutical company, reported Net income for fiscal 2007 of $8,144 million, Retained earnings at the start of the year of $49,669 million and dividends of $8,153 million. If there were no other transactions during the year that affected retained earnings, what was the balance of retained earnings at the end of the year

Answers

Answer:

$49,660 million

Explanation:

The computation of retained earnings at the end of the year is shown below;

= Beginning retained earnings + Net income - Dividends

Given that;

Beginning retained earnings = $49,669 million

Net income = $8,144million

Dividend = $8,153

Balance of retained earnings at the end of the year

= $49,669 + $8,144 - $8,153

= $49,660 million

n the theory of perfect competition, the assumptions of many buyers and sellers, the production of a homogeneous product, and the possession of all relevant information by buyers and sellers imply that the perfectly competitive firm a. has a demand curve that is perfectly inelastic. b. has a demand curve that is perfectly elastic. c. sets the price it wishes. d. has a demand curve that is downward sloping

Answers

Answer:

b. has a demand curve that is perfectly elastic. c. sets the price it wishes

Explanation:

Elasticity of demand is a measure of the degree of change in quantity demanded to changes in price.

For a perfectly elastic demand it means that an infinite quantity of a product will be required by consumers at a particular price. The perfectly elastic demand curve is usually horizontal.

In perfectly competitive markets elasticity of demand is perfectly elastic because there are many buyers and sellers, production of a homogeneous product, and the possession of all relevant information by buyers and sellers.

So prices between products tend to be the same

The stock price of Bravo Corp. is currently $100. The stock price a year from now will be either $160 or $60 with equal probabilities. The interest rate at which investors invest in riskless assets is 6%. Using the binomial OPM, the value of a put option with an exercise price of $135 and an expiration date 1 year from now should be worth __________ today.

Answers

Answer:

$38.21

Explanation:

The computation of the value of put option is shown below;

Hedge ratio is

= (Pay off in case price appreciates - Pay off in case of price depreciates) ÷ (Appreciated price - Depreciated price)

= (Max[$135 - $160, $0] - Max[$135 - $60, $0]) ÷ ($160 - $60)

= ($0 - $75) / $100

= -0.75

Now, Price of Put option is

= -Hedge ratio × {Appreciated price ÷ (1 + risk free rate) - Present stock price}

= -(-0.75) × {$160 ÷ (1 + 6%) - $100}

= $38.21

Depreciation--Jerry Company purchased machinery for $315,000 on May 1,2020 . It is estimated that it will have an useful life of 5 years, and a salvage value of $15,000. the machine is expected to last 100,000 hours. The machine was used for 25,000 hours the first year. What is the depreciation for the first year assuming working hours method (activity method) is expected to be used

Answers

Answer:

The depreciation for the first year is $75,000

Explanation:

In working hours method the depreciation on a fixed asset is charged using the ratio of numbers of hours utilized by the asset in a period and lifetime working capacity in hours.

First, we need to calculate the Depreciable value

Depreciable value = Cost of Asset - Salvage value = $315,000 - $15,000 = $300,000

Depreciation = Depreciable value x Numbers of hours worked / Total working capacity of Asset = $300,000 x 25,000 / 100,000 = $75,000

Jia's Fashions recently paid a​ $2 annual dividend. The company is projecting that its dividends will grow by 20 percent next​ year, 12 percent annually for the two years after​ that, and then at 6 percent annually thereafter. Based on this​ information, how much should​ Jia's Fashions common stock sell for today if her required return is​ 10.5%?

Answers

Answer:

years late but here ya go  (answer $59.16)

Explanation:

P0 =  2 * (1+0.2) / (1+0.105)  +  2 * (1+0.2) * (1+0.12)  /  (1+0.105)^2  +  

2*(1+0.2)*(1+0.12)^2 / (1+0.105)^3 +

[(2 * (1+0.2) * (1+0.12)^2 * (1+0.06) / (0.105-0.06))  /  (1+0.105)^3 ]

P0 = $59.16

On January 1, year 1, Olinto created a $650,000 trust that provided his mother with a lifetime income interest starting on January 1, year 1, with the remainder interest to go to his son. Olinto expressly retained the power to revoke both the income interest and the remainder interest at any time. Who is taxed on the trust's year 1 income

Answers

Answer:

c. Olinto

Explanation:

Multiple choice "a. Olinto's mother, b. Olinto's son, c. Olinto, d. The trust"

As the income tax rules mandate the liability to pay tax on trustees, the tax can be levied and recovered from a representative assesse i.e., the trustee who is Olinto. Olinto is a grantor and thus as per section 676, he must be taxed on the income generated through revocable trust.

The cost of equity for a firm is 20%. If the real interest rate is 5%, the inflation premium is 3%, and the market risk premium is 2%, what is the investment risk premium for the Firm

Answers

Answer: 10%

Explanation:

Investment risk premium is used to determine the returns an investor makes in excess of real interest rates, inflation and the market return;

= Cost of Equity - Real interest rate - Inflation premium - Market risk premium

= 20% - 5% - 3% - 2%

= 10%

Describe the technologies that contributed to the development and advancement of the newspaper from small, infrequent circulations of a few brief pages to the mass production of daily, extensive pages of news.

Answers

Answer: The industrial revolution came with the advent of the stream powered printing press, enabling newspapers to be produced in masses

Explanation:

The industrial revolution came with the advent of the stream powered printing press, enabling newspapers to be produced in masses. Improvement also took place in the inking process to aid speed up production also introduction of wood pulp helping drive production cost. One of the major advantage for this widespread growth was the relevance the newspaper gained globally as worthy news ready to be reported were available.

Mcniff Corporation makes a range of products. The company's predetermined overhead rate is $19 per direct labor-hour, which was calculated using the following budgeted data: Variable manufacturing overhead $ 32,000 Fixed manufacturing overhead $ 272,000 Direct labor-hours 16,000 Management is considering a special order for 730 units of product O96S at $67 each. The normal selling price of product O96S is $78 and the unit product cost is determined as follows: Direct materials $ 40.00 Direct labor 15.00 Manufacturing overhead applied 19.00 Unit product cost $ 74.00 If the special order were accepted, normal sales of this and other products would not be affected. The company has ample excess capacity to produce the additional units. Assume that direct labor is a variable cost, variable manufacturing overhead is really driven by direct labor-hours, and total fixed manufacturing overhead would not be affected by the special order. Required: The financial advantage (disadvantage) for the company as a result of accepting this special order would be:

Answers

Babe if ur reading this I am dead bc it took me a lifetime to read this now if you excuse me I have to start from the top again bc I lost my place bc it’s so much words

An assembly line with 15 tasks is to be balanced. The longest task is 2.9 minutes, and the total time for all tasks is 17 minutes. The line will operate for 450 minutes per day. a. What are the minimum and maximum cycle times

Answers

Answer:

Minimum ⇒ 2.9 minutesMaximum ⇒ 17 minutes

Explanation:

Minimum cycle time ⇒ This is the time taken for the longest task to be completed. In this case that is 2.9 minutes.

Maximum cycle time ⇒ This is the time taken for all the tasks to be completed. In this case that is 17 minutes.

The regular pattern of collection of credit sales is 30% in the month of sale, 60% in the month following the month of sale, and the remainder in the second month following the month of sale. There are no bad debts. The budgeted accounts receivable balance on May 31 would be:

Answers

Answer:

$242,000

Explanation:

Calculation for what The budgeted accounts receivable balance on May 31 would be

Accounts Receivable

Debit side

April 320,000

May 300,000

Total $620,000

Credit side

April 96,000 (30% x 320,000)

April 192,000 (60% x 320,000)

May 90,000 (30% x 300,000)

Total=$378,000

The budgeted accounts receivable balance=$620,000-$378,000

The budgeted accounts receivable balance=$242,000

Therefore The budgeted accounts receivable balance on May 31 would be $242,000

A new sports car sells for $40,000. The value of the car decreases by 12% annually. After how many years will it be worth half of its selling price

Answers

Answer:

n= 6.11 years

Explanation:

Giving the following information:

Present value= $40,000

Future value= $20,000

Decrease rate= 0.12

To calculate the number of years for the car to reach a value of $20,000; we need to use the following formula:

n= ln(FV/PV) / ln(1+i)

n= ln(20,000/40,000) / ln(1.12)

n= 6.11 years

Tom's family and close friends have both a direct and indirect influence on his attitude and behavior when considering purchases. This is considered Tom's ________________________. Group of answer choices Role

Answers

Answer:

Reference group

Explanation:

A reference group is the group where there is a people that compared for ourselves irrespective of the part of the group or not. In this in understand the social norms that can shape our values, ideas, attitudes, behavior, etc

Since in the given question it is mentioned that Tom has both direct and indirect influence with respect to his attitude and behavior while when he considered the purchase so this represent the reference group

hence, the same is to be considered

The standard price and quantity of direct materials are separated because a.direct materials prices are controlled by the purchasing department and quantity used is controlled by the production department b.standard prices are more difficult to estimate than standard quantities c.standard quantities change more frequently than standard prices d.GAAP and IFRS reporting requires separation

Answers

Answer:

a.direct materials prices are controlled by the purchasing department and quantity used is controlled by the production department

Explanation:

In the case when the standard price and the quantity with respect to the direct material are distinct as the price of the direct material would be controlled by the purchasing department while on the other hand, the quantity would be controlled by the production department

Therefore as per the given situation, the correct option is a.

An insurance company is thinking about offering discounts on its life insurance policies to nonsmokers. As part of its analysis, it selects 200 men who are 50 years old and asks them if they smoke at least one pack of cigarettes per day, and if they have ever suffered from heart disease. The results indicate that 20 out of 80 smokers and 15 out of 120 nonsmokers suffer from heart disease. At 5% level of significance the conclusion is:

Answers

Answer:

Test statistic

|Z| = 2.996 > 1.96 at 5% level of significance

Null hypothesis is accepted

There is difference between smokers and non-smokers

Explanation:

Step(i):-

Given size of the sample = 200

First Sample proportion  

                                  [tex]p^{-} _{1} = \frac{20}{80} = 0.25[/tex]

Second sample proportion

                               [tex]p^{-} _{2} = \frac{15}{120} = 0.125[/tex]

Null Hypothesis : p₁ = p₂

Alternative Hypothesis : p₁≠p₂

Step(ii):-

Test statistic

                [tex]Z = \frac{p^{-} _{1}-p^{-} _{2} }{\sqrt{PQ(\frac{1}{n_{1} } +\frac{1}{n_{2} } )} }[/tex]

Where

             [tex]P = \frac{n_{1} p_{1} + n_{2} p_{2} }{n_{1}+n_{2} }[/tex]

             

          [tex]P = \frac{200X 0.25+ 200 X 0.125 }{400 } = 0.185[/tex]

         Q = 1-P = 0.8125

           [tex]Z = \frac{0.25-0.125 }{\sqrt{0.185X0.8125(\frac{1}{200} +\frac{1}{200 } )} }[/tex]

          Z =  -2.996

The calculated value |Z| = 2.996 > 1.96 at 5% level of significance

Null hypothesis is accepted

There is difference between smokers and non-smokers

               

Roy agrees to work as a financial advisor on a commission basis for Secure Investments, Inc., and signs an employment contract that includes an arbitration clause. A dispute arises over the amount of Roy's commission. Roy files a suit against Secure Investments, seeking $25,000 in unpaid commissions and $50,000 in other damages. Secure Investments insists that the parties submit the dispute to arbitration. On what Roy believes is insufficient evidence, the arbitrator awards Roy only $500 and issues a written opinion that includes an erroneous finding of fact and a mistaken conclusion of law. Can Roy successfully challenge this award in court

Answers

Answer:

Yes.  Roy can successfully challenge this arbitration award in court.

Explanation:

According to the law, an arbitration clause is a part of the contract between Roy and Secure Investments, Inc. that deals with these parties' rights and options in the event of a legal dispute over their contract.  Like in most arbitration clauses, Roy and Secure Investments, Inc. must have agreed not to sue each other but instead, to resolve their disputes through the arbitration process.  But the res judicata effect produced through an arbitration can either be challenged and appealed against or enforced.  Roy, depending on the merits of his case, can make a successful appeal against the arbitration award and not against the arbitration itself.

On June 1, 2021, Emmet Property Management entered into a 2-year contract to oversee leasing and maintenance for an apartment building. The contract starts on July 1, 2021. Under the terms of the contract, Emmet will be paid a fixed fee of $54,000 per year and will receive an additional 10% of the fixed fee at the end of each year provided that building occupancy exceeds 80%. Emmet estimates a 20% chance it will exceed the occupancy threshold, and concludes the revenue recognition over time is appropriate for this contract. Assume Emmet estimates variable consideration as the most likely amount. How much revenue should Emmet recognize on this contract in 2021? Multiple Choice $27,540 $54,000 $30,750 $27,000

Answers

Answer:

$27,540

Explanation:

Expected amount = Possible amount into probability

Expected amount = ($54,000*80%) + ($54,000+10%)*20%

Expected amount = $43,200 + ($54,000+$5,400)*20%

Expected amount = $43,200 + $59,400*20%

Expected amount = $43,200 + $11,880

Expected amount = $55,080

Revenue to be recognized on this contract in 2021 = $55,080 * 6/12 = $27,540.

In the Month of March, Digby received orders of 182 units at a price of $15.00 for their product Deal, and in April receives an order for 46 units of their product Deal at $15.00. Digby uses the accrual method of accounting and offers 30 day credit terms. Digby delivers 0 units in March, 182 units in April and 46 units in May. They received payment for 182 units in April, and payment for 46 units in May. How much revenue is recognized on the March income statement from this order

Answers

Answer: 0

Explanation:

Accrual accounting method simply means when revenue or expenses are written down and recorded at the time that the transaction took place and not when payment was gotten.

The revenue that is recognized on the March income statement will be 0. This is because the delivery was in April and none took place in March.

If two identifiable markets differ with respect to their price elasticity of demand and resale is impossible, a firm with market power will Group of answer choices Set price equal to marginal cost in both markets. Set price so as to equate the elasticity of demand across markets. Set a higher price in the market that is more elastic. Set a lower price in the market that is more price elastic.

Answers

Answer: Set a lower price in the market that is more price elastic.

Explanation:

It would be in the best interest of the firm with market power to set a lower price if the market is more price elastic.

Price elasticity is the measure of how much quantity demanded changes in response to a change in price.

If the firm with market power sets a lower price in a market that is more price elastic, it can expect that the quantity demanded will increase more which can give a higher profit.

During 2020, Sandeep had the following transactions: Salary $ 80,000 Interest income on City of Baltimore bonds 1,000 Damages for personal injury (car accident) 100,000 Punitive damages (same car accident) 200,000 Cash dividends from Chevron Corporation stock 7,000 Sandeep's AGI is: a.$387,000. b.$285,000. c.$287,000. d.$187,000.

Answers

Answer: c.$287,000.

Explanation:

City of Baltimore bonds are Municipal so their interest are tax exempt and so are Damages for personal injury.

Sandeep's AGI is therefore;

= Salary + Punitive damages + Cash dividends from Chevron

= 80,000 + 200,000 + 7,000

= $287,000

What are some ways that businesses can implement internal accounting controls

Answers

5 Ways to Implement Internal Controls at Your Company or...
Segregation of Duties in the Cash Receipts Cycle. ...
Systems Access and Security. ...
Safeguarding Assets. ...
Approval Process. ...
Review Process. ...
Contact Us with Your Questions.

Answer:

Segregation of Duties in the Cash Receipts Cycle.  

Systems Access and Security.  

Safeguarding Assets.  

Approval Process.  

Review Process.

Explanation:

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