Trades among three members, A, B and C, are settled via multi-lateral netting with a centralized counterparty (CCP). The trades are listed below: i) A buys 5 shares from B ii) B buys 10 shares from A iii) A buys 7 shares from D iv) A sells 10 shares to D v) B sells 15 shares to D What is the net settlement between the CCP and member A?
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- 16. With regard to contracts that can be settled in either cash or shares IFRS requires that share settlement must be used. IFRS gives companies a choice of either cash or shares. GAAP requires that share settlement must be used. the FASB project proposes that the IASB adopt the GAAP approach, requiring that share settlement must be used.Required: (1) Determine whether Grealish will accept the contract. Show calculations of his utility to two decimal places. Also, indicate whether Grealish will work hard or shirk. (include all steps of calculation) (2) Calculate Jack's utility. Jack is risk-neutral and his utility for money is equal to the cash received. (include all steps of calculation) (3)Jack's business has publicly traded shares. Explain whether you would recommend a compensation contract based on both net income and share price performance under the following conditions; a- Net income is calculated based on historical cost. b- Net income is calculated based on fair value accounting.Matching type. Match these 4 investments into its corresponding definition below 1. Investment in trading securities. 2. Investment in long-term securities. 3. Investment in associates accounted for using the equity method. 4. Investment in subsidiary Definitions: a. to take advantage of flunctuations of prices in the market b. to exert significant influence over another entity so as to obtain benefits from its operations c. To earn investment income such as interest and dividend and additional source of liquidity such as selling investments as the need arises. d. For trading purposes, for speculative purposes, and to manage risk exposures if used as a hedging instrument e. to exert control over another entity thus enabling the investor to be entitled to variable returns from its involvement with the investee f. to earn rental income and for capital appreciation.
- Question 2 Firm A and B are exactly the same size as are Firm C and Firm D. Firm A acquires for cash 100 percent of the common stock of Firm C; Firm B acquires 100 percent of Firm D by exchanging one share of its own stock for each share of common stock of Firm D. Are there differences in relevant circumstances between these two transactions? Explain. Full explain this question and text typing work only thanksQ21 An investor is generally considered to have significant influence in the investee under which of the following conditions? Select one: a. The investor has more than 50% of the voting power in the associate. b. The investor has more than 20% of the voting power in the associate but does not have more than 50%. c. The investor has less than 20% of the voting power of the associate. d. The investor owns part of the share capital of an associate whether or not there are voting rights attached to the shareholding.20. For share appreciation rights S1. the measurement date for liability instruments is the settlement date. S2. share-based payments are remeasured at the end of each reporting period S3. compensation cost is the change in fair value of the instrument from one period to the next a. S1 only b. S2 only c. S1 and S3, but not S2 d. either of the 3 statements is correct e. S3 only f. S2 and S3 but not S1 g. S1 and S2, but not S3
- For number 16, which one is correct for my answer? Answer A: Amount received (4,000 x P225 x 25%) P225,000 at par value (4,000 x P200 x 25%) P200,000 Share premium P25,000 only those which are paid, are recognized. Answer B: Issue price (4,000 x 225) 900,000 Preference share capital (4,000 x 200) 800,000 Share premium (APIC) 100,000 Please explain to me which one is the correct answer.Firm E is going to acquire Firm F. The acquisition will be done via a share exchange, whereby Firm E will exchange 2.65 of its shares for every one of Firm F's shares. Synergy is $1,250,000 in total. Firm E has 350,000 shares outstanding trading at $35 each. Firm F has 45,000 shares outstanding trading at $84 each. What would the exchange ratio have to be for the NPV of the deal to be zero? Question 1 options: A) 3.13 shares of E for every 1 of F B) 0.41 shares of E for every 1 of F C) 3.15 shares of E for every 1 of F D) 2.40 shares of E for every 1 of F E) 3.19 shares of E for every 1 of F20 - Why did a joint stock company make this journal entry? …/…/201. Will borrow 780 Financial Expenses xxx 191 VAT to be deducted xxxx 100 Cash xxx A) NoneB) For VAT settlementC) To pay the expenses of the partnersD) to cover general administrative expensesE) To account for expenses in issuing bonds
- 18 - Which of the following accounts includes securities acquired for long-term purposes and capital shares acquired for the purpose of becoming a partner in another business ? a) 12 Trade Receivables Account Group B) 23 Other Receivables Account Group NS) 22 Trade Receivables Account Group D) 13 Other Receivables Account Group TO) 24 Financial Fixed Assets Account GroupStatement 1: Upon issue of share rights, the issuing corporation records the transaction by preparing a journal entry to recognize the additional number of shares that may be acquired through the exercise.Statement 2: When preference shares are issued with detachable warrants, the proceeds should be allocated between the preference shares and the warrants based on the fair values of the two securities at the time of issuance. a) Both statements are true. b) Both statements are false. c) Statement I is true; Statement II is false. d) Statement I is false; Statement II is true.10. If an investor were to sell 100 shares of MicroSoft stock to another investor in the securities market, this would be referred to as what type of transaction? a. A primary market transaction. b. A secondary market transaction c. A money market transaction. d. A futures market transaction. e. None of the above.
