Sen Corporation warrants carry the right to buy 10 shares of Sen common stock at $11.00 per share. The common stock has a current market price of $11.75 per share. The intrinsic or minimum value of one Sen warrant is ________. A. $7.50 B. $0 C. $1.50 D. $15
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Sen Corporation warrants carry the right to buy 10 shares of Sen common stock at $11.00 per share. The common stock has a current market price of $11.75 per share. The intrinsic or minimum value of one Sen warrant is ________.
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- Jacobs Company has warrants outstanding, which are selling at a $2.50 premium above intrinsic value. Each warrant allows its owner to purchase one share of common stock at $26. If the common stock currently sells for $30, what is the warrant price? A. $6.50 B. $6.40 C. $6.75 D. $7.25Lakeshore Gelato issues 2, 500 shares of $30 par preferred stock with detachable warrants for $215, 000 on January 1, 20Y1. Each share of preferred stock is issued with 10 detachable warrants. Each warrant entitles the holder to purchase one share of common stock for $25. The warrants expire in 2 years. The fair market value of the preferred stock is $145, 000 on January 1, 20Y1, and the warrants sell for $3 per warrant. On July 1, 20Y2, the warrants are exercised to purchase common stock (with a par value of $10 per share). The exercise price is $25 per share. Record the Lakeshore Gelato Entries (rounded to the penny) for: (1) Issuance (round the aggregate value percentage to two decimals ie 75.45%) (2) Exercise of WarrantsAn investor has P1,000 that she is interested in investing i Huan Inc. stock, which is currently selling for P50 per share.Huan Inc.'s warrants are selling for P12 per warrant. Each warrant entitles the holder to purchase three shares of Huan Inc.'s common stock for P47 per share. The warrant premium is Format: 1
- Maese Industries Inc. has warrants outstanding that permit the holders to purchase 1 share of stock per warrant at a price of $25. a. Calculate the exercise value of a warrant at each of the following common stock prices: (1) $20, (2) $25, (3) $30, (4) $100. (Hint: A warrant’s exercise value is the difference between the stock price and the purchase price specified by the warrant if the warrant were to be exercised.) b. Assume the firm’s stock now sells for $20 per share. The company wants to sell some 20-year, $1,000 par value bonds with interest paid annually. Each bond will have attached 50 warrants, each exercisable into 1 share of stock at an exercise price of $25. The firm’s straight bonds yield 12%. Assume that each warrant will have a market value of $3 when the stock sells at $20. What coupon interest rate, and dollar coupon, must the company set on the bonds with warrants if they are to clear the market? (Hint: The convertible bond should have an initial price of $1,000.)An investor has P1,000 that she is interested in investing in National Inc. stock, which is currently selling for P50 per share. National Inc.'s warrants are selling for P12 per warrant. Each warrant entitles the holder to purchase three shares of National Inc.'s common stock for P47 per share. The warrant premium isMaese Industries Inc. has warrants outstanding that permit the holders topurchase 1 share of stock per warrant at a price of $25.a. Calculate the exercise value of the firm’s warrants if the common sellsat each of the following prices: (1) $20, (2) $25, (3) $30, (4) $100. (Hint:A warrant’s exercise value is the difference between the stock price andthe purchase price specified by the warrant if the warrant were to beexercised.)
- On january 1, 2022, a company issued P2,000,000, 16% bonds at 102. Each P1,000 bonds has one detachable warrant that allows the holder to purchase ten shares of P50 par value stock at P70 per share. The bonds would have been sold at 99 without the warrants. In 2023, 800 warrants were exercised. How much is the credit to share premium when the warrants were exercised?On march 1 2023, Star corporation issue P500,000 of 10%, 7 year bonds with 1 taxable warrants attached to each P1,000 bond. each warrants provides for the right to purchase 20 shares of P15 ordinary shares for 20 each. The market value of the ordinary shares was P25 per share on july 1, 2023. the detachable warrants market price was P70 per warrant and the arket value of the bond without the warrants attached is P104. The bond was sold at 107. How much is the Premium or Discount on the issuance of bonds? P20,000 How much is the warrants outstanding? P15,000 Show full solutionMaese Industries Inc. has warrants outstanding that permit the holders to purchase 1 share of stock per warrant at a price of $29. Calculate the exercise value of a warrant at each of the following common stock prices: (1) $20, (2) $25, (3) $30, (4) $100. (Hint: A warrant's exercise value is the difference between the stock price and the purchase price specified by the warrant if the warrant were to be exercised.) If your answer is zero, enter "0". Round your answers to the nearest dollar. (1) $20 $ (2) $25 $ (3) $30 $ (4) $100 $
- 28. On December 31, 2020, Nyza Company issued 200,000 shares of P100 par, 10% cumulative preferred stock for P25,000,000. One detachable warrant was attached to each preferred share issued. Each warrant gives the holder the right to purchase one common share with a P50 par value for P100. The market value of the warrant after the preferred stock was issued was P15. The warrants expire on December 31, 2021. On July 1, 2021, all of the warrants were exercised. On this date, the market prices were P120 for the common and P20 for the warrant. As a result of exercising the warrants, determine the net increase to stockholders’ equity.27. On December 31, 2020, Nyza Company issued 200,000 shares of P100 par, 10% cumulative preferred stock for P25,000,000. One detachable warrant was attached to each preferred share issued. Each warrant gives the holder the right to purchase one common share with a P50 par value for P100. The market value of the warrant after the preferred stock was issued was P15. The warrants expire on December 31, 2021. On July 1, 2021, all of the warrants were exercised. On this date, the market prices were P120 for the common and P20 for the warrant. With the issue price allocated to preferred stock on December 31, 2020, how much is the share premium – preferred stocks?On December 31, 2019, Palau Company issued 200,000 shares of P100 par, 10% cumulative preference shares for P25,000,000. One detachable warrant was attached to each preference share issued. Each warrant gives the holder the right to purchase one ordinary share, P50 par value, for P100. The market value of the warrant after the preference shares were issued was P15. The warrants expire on December 31, 2020. What amount of proceeds should be allocated to the preference shares on December 31, 2019?
