How many shares will the dollar bonds convert into

Assignment Help Financial Accounting
Reference no: EM132493959

Point 1: The company also owns 10 Million dollar (par value) in 10 year bonds for Cascular Incan electronic firm. The bonds pay an annual interest of 5% at the end of the year. The bonds have 62 months to maturity, however in 2 months the bonds convertible options will expire. The bonds currently have a yield of 5.2%. Shares of Cascular Incan are trading at $55/Share. Leslie has performed analysis which shows that converting the bonds into common shares will result in a favorable gain of $400,000 for Butlers vs. keeping the bonds at their current value.

Required:

Question 1: If Leslie is expecting a favorable gain of $400,000 how many shares will the $10 Million dollar bonds convert into? (Determine the PV and see if Leslie did the gain properly from conversion vs. present value)

 

Reference no: EM132493959

Questions Cloud

Calculate mcdonnell-myer earnings per share for the year : Calculate McDonnell-Myer's earnings per share for the year. (Do not round intermediate calculations. Round your final answer to 2 decimal places.)
Journalize the transactions for the seller Lee Company : Journalize the following transactions for the seller, Lee Company, using the gross method to account for sales discounts. Assume a perpetual inventory system
Prepare the journal entries to record compensation expense : Prepare the journal entries to record compensation expense in 2022 and 2023. What action will be taken to account for the options in 2022?
What is Edwards basis in the land : David contributed land with a basis of $5,000 and a FMV of $9,000 to the DEF partnership. What is Edwards basis in the land
How many shares will the dollar bonds convert into : If Leslie is expecting a favorable gain of $400,000 how many shares will the $10 Million dollar bonds convert into? The company also owns 10 Million dollar
What is the appropriate journal entries : At the start of 2019, Croton's Capital Projects Fund had no assets or liabilities. What is the appropriate journal entries to record these transactions
What amount should hmcc record as compensation expense : What amount should HMCC record as compensation expense for the year ended December 31, 2022, assuming HMCC chooses the option to record forfeitures
How much of the loss can Travis deduct : Travis' adjusted gross income in the current year, before considering the rental properties, is $120,000. How much of the loss can Travis deduct
Determine the expected values of the mean squares : Determine the degrees of freedom for the pure error and the lack of fit error and Determine the expected values of the mean squares of the pure error

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd