Question 1
Intermediate corporation asked for your assistance with their earnings per share calculation for the year ended 12/31/2012. They provide you with the following information. they had 500,000 shares of stock outstanding on 1/1/2012. the average market value of each share is $25 for 2012. Their net income for 2012 was $1,200,000 and their tax rate is 40%. On April 1 they issued 75,000 shares. On June 1 they acquired 37,500 shares from the open market to use as treasury stock. Intermediate has 2000 stock options outstanding for the entire year. each option can be exchanged for one share of common stock at an exercise price of $20. In addition, Intermediate has outstanding for the entire year, a bond which was issued at par with face value of $2,000,000 and a 5% interest rate. Each $1000 bond is convertible into 20 shares of Intermediate common stock. Intermediate also has 40,000 shares of %6 convertible, cumulative preferred stock ($100 par value) which was outstanding for the full year. Each preferred share can be converted into 3 shares of common stock, No preferred dividends have been declared for the current year or the preceding 2 years. Provide basic and diluted earnings per share calculation.,Thank you,I have a question about share issued against convertible bond, why do we divide by 1000?, also what is stock option scheme and how did you come up with that number?,Also how did you calculate the interest on bonds to come up with 6000,the face value of bond shouldnt be 2,000,000 instead of $200,000?,I turned in my work and other students had different answers for basic they had 1.76 and diluted they had 1.79. Are they wrong or is this wrong?,I have sent again the same problem and looks like you have done it again and this time you gave me totally different answers. Is it a computer that does them or actual accountant? I'm very displeased.,I did submitted the same question twice because I wanted to see if you would get same answer but this time it was totally different. How accurate is your work? I will be getting bad grade because I trusted you that you can help me.
Question 3
7. The production budget shows that expected unit sales are 40,000. The total required units are 45,000. What are the required production units? a. 5,000 b. 7,500 c. 10,000 d. Cannot be determined from the data provided. 8. The direct materials budget shows: Units to be produced 3,000 Total pounds needed for production 12,000 Total materials required 13,200 What are the direct materials per unit? a. .44 pounds b. 4.0 pounds c. 4.4 pounds d. Cannot be determined from the data provided. 9. The direct materials budget shows: Desired ending direct materials 36,000 pounds Total materials required 54,000 pounds Direct materials purchases 47,400 pounds The total direct materials needed for production is a. 18,000 pounds. b. 6,600 pounds. c. 11,400 pounds. d. 101,400 pounds. 10. If the required direct materials purchases are 18,000 pounds, the direct materials required for production is three times the direct materials purchases, and the beginning direct materials are three and a half times the direct materials purchases, what are the desired ending direct materials in pounds? a. 45,000 b. 9,000 c. 27,000 d. 18,000 11. Razmataz Company makes and sells umbrellas. The company is in the process of preparing its Selling and Administrative Expense Budget for the last half of the year. The following budget data are available: Variable Cost Per Unit Sold Monthly Fixed Cost Sales commissions $0.60 $ 3,000 Shipping 1.20 Advertising 0.30 Executive salaries 20,000 Depreciation on office equipment 4,000 Other 0.35 14,000 Expenses are paid in the month incurred. If the company has budgeted to sell 4,000 umbrellas in October, how much is the total budgeted variable selling and administrative expenses for October? a. $8,400 b. $9,200 c. $50,800 d. $9,800 12. A company budgeted unit sales of 102,000 units for January, 2008 and 120,000 units for February, 2008. The company has a policy of having an inventory of units on hand at the end of each month equal to 30% of next month's budgeted unit sales. If there were 30,600 units of inventory on hand on December 31, 2007, how many units should be produced in January, 2008 in order for the company to meet its goals? a. 107,400 units b. 102,000 units c. 96,600 units d. 138,000 units 13. At January 1, 2008, Ceatric, Inc. has beginning inventory of 2,000 surfboards. Ceatric estimates it will sell 5,000 units during the first quarter of 2008 with a 12% increase in sales each quarter. Ceatric?s policy is to maintain an ending inventory equal to 25% of the next quarter?s sales. Each surfboard costs $100 and is sold for $150. How much is budgeted sales revenue for the third quarter of 2008? a. $225,000 b. $975,000 c. $940,800 d. $6,272 14. Sargent.Com plans to sell 2,000 purple lawn chairs during May, 1,900 in June, and 2,000 during July. The company keeps 15% of the next month?s sales as ending inventory. How many units should Sargent.Com produce during June? a. 1,915 b. 2,200 c. 1,885 d. Not enough information to determine. 15. Secret Prizes, Inc. is planning to sell 200 buckets and produce 190 buckets during March. Each bucket requires 500 grams of plastic and one-half hour of direct labor. Plastic costs $10 per 500 grams and employees of the company are paid $15.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Secret Prizes has 300 kilos of plastic in beginning inventory and wants to have 200 kilos in ending inventory. How much is the total amount of budgeted direct labor for March? a. $1,500 b. $3,000 c. $1,425 d. $2,850 Use the following information for questions 16?18. Sudler Production is planning to sell 600 boxes of ceramic tile, with production estimated at 580 boxes during May. Each box of tile requires 44 pounds of clay mix and a quarter hour of direct labor. Clay mix costs $0.50 per pound and employees of the company are paid $15.00 per hour. Manufacturing overhead is applied at a rate of 110% of direct labor costs. Sudler has 2,600 pounds of clay mix in beginning inventory and wants to have 3,000 pounds in ending inventory. 6) Round Company currently produces cardboard boxes in an automated process. Expected production per month is 40,000 units. The required direct materials cost $0.30 per unit. Manufacturing fixed overhead costs are $24,000 per month. The cost driver for manufacturing fixed overhead costs is units of production. In a flexible budget at 20,000 units, the total fixed cost is ________ per month and the total variable cost is ________ per month. A) $24,000; $6,000 B) $24,000; $12,000 C) $12,000; $6,000 D) $12,000; $12,000 7) Red Company had the following information available: Expected Costs and Selling Price Based on 5,000 Units: Variable manufacturing costs per unit $32 Fixed manufacturing costs per unit $20 Selling price per unit $70 Expected production level 5,000 units In the flexible budget at 15,000 units, what is the total manufacturing cost? A) $480,000 B) $580,000 C) $680,000 D) $780,000 8) The following data are for Sacramento Corporation: Flexible Budget for Actual Static Budget Actual Sales Activity Units 18,000 16,000 18,000 Sales $360,000 $320,000 $360,000 Variable costs 234,000 192,000 216,000 Contribution margin $126,000 $128,000 $144,000 Fixed costs 76,000 80,000 80,000 Operating income $50,000 $48,000 $64,000 The static budget variance for operating income is ________. A) $2,000 Favorable B) $2,000 Unfavorable C) $16,000 Favorable D) $16,000 Unfavorable,Thank's a Lot :) MARIA,No problem, move a deadline for this question upon you request me 2011-10-22 12:30pm. Thank's for advice me, MARIA
Question 4
Question 1 If last dividend = $6, g = 6.4%, and P0 = $69.3, what is the stock?s expected total return for the coming year? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer . Question 2 ABC Inc., is expected to pay an annual dividend of $0.3 per share next year. The required return is 15.4 percent and the growth rate is 4.7 percent. What is the expected value of this stock five years from now? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 3 ABC Enterprises' stock is currently selling for $50.4 per share. The dividend is projected to increase at a constant rate of 7.3% per year. The required rate of return on the stock is 12%. What is the stock's expected price 5 years from today (i.e. solve for P5)? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 4 A stock just paid a dividend of $3. The required rate of return is 16.5%, and the constant growth rate is 3.2%. What is the current stock price? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 5 ABC just paid a dividend of D0 = $4.9. Analysts expect the company's dividend to grow by 30% this year, by 22% in Year 2, and at a constant rate of 5% in Year 3 and thereafter. The required return on this stock is 12%. What is the best estimate of the stock?s current market value? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 6 ABC's stock has a required rate of return of 13%, and it sells for $74 per share. The dividend is expected to grow at a constant rate of 4.7% per year. What is the expected year-end dividend, D1? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 7 A stock is expected to pay a dividend of $1.8 at the end of the year. The required rate of return is rs = 11.7%, and the expected constant growth rate is g = 6.9%. What is the stock's current price? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 8 ABC is expected to pay a dividend of $1 per share at the end of the year. The stock sells for $107 per share, and its required rate of return is 13.2%. The dividend is expected to grow at some constant rate, g, forever. What is the growth rate (i.e. solve for g)? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer . Question 9 If D1 = $4.86, g (which is constant) = 2%, and P0 = $81.65, what is the stock?s expected dividend yield for the coming year? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer . Question 10 ABC Company's last dividend was $0.7. The dividend growth rate is expected to be constant at 28% for 2 years, after which dividends are expected to grow at a rate of 6% forever. The firm's required return (rs) is 16%. What is its current stock price (i.e. solve for Po)? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 11 If D1 = $6.1, g (which is constant) = 2.9%, and P0 = $76.4, what is the stock?s expected total return for the coming year? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer . Question 12 The common stock of Connor, Inc., is selling for $85 a share and has a dividend yield of 2.8 percent. What is the dividend amount? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 13 The common stock of Wetmore Industries is valued at $54.8 a share. The company increases their dividend by 4.6 percent annually and expects their next dividend to be $4.5. What is the required rate of return on this stock? Note: Enter your answer rounded off to two decimal points. Do not enter % in the answer box. For example, if your answer is 0.12345 then enter as 12.35 in the answer box. Answer . Question 14 A stock just paid a dividend of D0 = $2.4. The required rate of return is rs = 17.7%, and the constant growth rate is g = 3.6%. What is the current stock price? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 15 ABC?s last dividend paid was $1.1, its required return is 12.4%, its growth rate is 3.6%, and its growth rate is expected to be constant in the future. What is Sorenson's expected stock price in 7 years, i.e., what is P7? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 16 ABC's last dividend was $3.2. The dividend growth rate is expected to be constant at 20% for 3 years, after which dividends are expected to grow at a rate of 6% forever. If the firm's required return (rs) is 12%, what is its current stock price (i.e. solve for Po)? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 17 A stock's next dividend is expected to be $1.7. The required rate of return on stock is 16.8%, and the expected constant growth rate is 7.1%. What is the stock's current price? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer . Question 18 ABC Enterprises' stock is expected to pay a dividend of $1.9 per share. The dividend is projected to increase at a constant rate of 8.9% per year. The required rate of return on the stock is 15.6%. What is the stock's expected price 3 years from today (i.e. solve for P3)? Note: Enter your answer rounded off to two decimal points. Do not enter $ or comma in the answer box. For example, if your answer is $12.345 then enter as 12.35 in the answer box. Answer