(Stock repurchase and taxes) The Barryman Drilling Company is planning on repurchasing $1.00 million worth of the company's 500,000 shares of stock, which is currently trading at a price of $10.01 per share. Stan Barryman is the founder of the company and still holds 18,000 shares of company stock that he originally purchased for $7.83 per share. If Stan decides to sell 2,100 of his shares for $10.01 a share, what will be his after-tax proceeds where capital gains are taxed at 15 percent? Stan's after-tax proceeds from the sale are $21021. (Round to the nearest dollar.)
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- Company C's capital includes $5 million in bonds and 8 million common shares with a market price of $60 per shares. The company has just announced a rights issue whereby an additional 2 million shares will be issued at a subscription price of $53 per share. The company's net income this year is $30 million. Your sister, who owns shares in the company, does not have the funds required to purchase the new shares and is concerned about the a possible decline in the company's earnings per share and P/E ratio after the rights issue. Required: Calculate the expected changes to the company's earnings per share and P/E ratio after the rights issue.Desert Company purchased land by exchanging 25,000 shares of the company's common stock that had a $10 par value. The land was recently appraised for $250,000. Desert's stock is not actively traded on the NYSE but last year a shareholder sold a block of 250 shares at a selling price of $20 per share. What is the original cost of the Land that will be recorded by Desert, Co., on their Balance Sheet?E. Adentwi Enterprises Ltd bought a machine for GH₵ 150,000 on 1st January 2019. It depreciates the machine on cost over four years assuming a nil residual value.The company received a grant of GH₵30,000 from the municipal assembly to support the acquisition of the machines.Account for this grant under the netting off method. Pleasant Place Plc is planning to obtain a stock market listing by offering 30% of its existing shares to the public. No new shares will be issued.Its most recent summarized results are as follows;Turnover GHC 120 mEarnings GHC 1,500mNumber of shares in issue 6 millionThe company is highly geared and has a dividend policy of 50% pay-out rate. And the retentionpolicy is expected to achieve 10% dividend growth each year.Summarized details of two listed companies in the same industry as Pleasant Place are asfollows;ICGC Ltd PCI ltdGearing (Total debt/ Equity) 45% 10%Equity Beta 1.60 1.10The current Treasury bill yield is 22% per annum. The average market return is…
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- On January 4, 2021, Snow Co. purchased 40,000 shares (40%) of the common stock of Walker Corp., paying $900,000. There was no goodwill or other cost allocation associated with the investment. Snow has significant influence over Walker. During 2021. Walker reported income of $240,000 and paid dividends of $75,000. On January 2, 2022, Snow sold 5,000 shares for $125,000. What was the balance in the investment account after the shares had been sold? Multiple Choice $871,500. $845,250. $761,250. $897,250. MacBook Air 888 DII Fア F10 F11 F2 F3 F4 23 $ & 3 4 5 8 { W E R Y U P F G J K く C V command option .. .- この * 00 B トThe board of directors of Blossom Corporation is considering two plans for financing the purchase of new plant equipment. Plan #1 would require the issuance of $5,500,000, 8%, 20-year bonds at face value. Plan #2 would require the issuance of 200,000 shares of $5 par value common stock that is selling for $25 per share on the open market. Blossom Corporation currently has 120,000 shares of common stock outstanding and the income tax rate is expected to be 30%. Assume that income before interest and income taxes is expected to be $800,000 if the new factory equipment is purchased.Prepare a schedule that shows the expected net income after taxes and the earnings per share on common stock under each of the plans that the board of directors is considering. (If answer is zero please enter 0, do not leave any fields blank. Round earnings per share to 2 decimal places, e.g. 5.25.) Plan #1Issue Bonds Plan #2Issue Stock select an option…On November 17, Tasty Foods purchased 1,000 shares (10%) of Eco-Safe Packaging's voting stock for $12 per share. Because Tasty Foods has no immediate plans to sell the stock, the investment is classified as an available-for-sale security. By the end of the year, Eco- Safe Packaging's stock price has dropped to $10 per share. How would the drop in stock price affect Tasty Foods' net income for the year? (LO D-2) a. Decrease net income by $12,000. b. Decrease net income by $10,000. c. Decrease net income by $2,000. d. No effect.