8.2 VWX Ltd, when raising capital for its inaugural balance sheet issued 7,000 £2NV shares at par, and raised a £40,000 6% loan stock repayable in 8 years; What were VXW's opening assets?
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8.2 VWX Ltd, when raising capital for its inaugural balance sheet issued 7,000 £2NV shares at par, and raised a £40,000 6% loan stock repayable in 8 years; What were VXW's opening assets?
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- 24. Company has the following capital structure as on December 31,1995.11% Debentures 5,00,00010% Pfef.Shares 1,00,0004,000 equity shares of 4,00,000 Rs. 100 each Total 10,00,000Equity shares are quoted at Rs. 102 and is is expected that the company will declare a dividend of Rs. 10/- per share at the end of the current year. The dividend is expected to grow at 10 % for the next five years. The companies tax rate is 50 %. a. Calculate form the foregoing data the cost of equity capital and WACC.b. If company raises additional debentures for Rs. 3 lacs at 12 % calculate the revised WACC if change are:increase in dividend rate from 10 to 12 % Reduction in growth rate from 10 to 8 % and fall in market price of share from Rs. 102 to 98.8.An investor purchased 100 shares of common stock at GH¢20 per share one year ago. The company declared and paid a dividend of GH¢2 per share during the year. The investor sold the stock for GH¢21 per share after the one-year holding period. a.Calculate the HPR for this investment Partition the HPR into dividend return and capital appreciation return .The stock of Payout Corp. will go ex-dividend tomorrow. The dividend will be $.50 per share, and there are 20,000 shares of stock outstanding. The market-value balance sheet for Payout is shown in the following table. Liabilities & Equity Assets $100,000 Cash Fixed $1,000,000 $1,000,000 assets 900,000 Equity Total $1,000,000 Total Required: (a.) (b.) (c.) What price is Payout stock selling for today? What price will it sell for tomorrow? Ignore taxes. Suppose that instead of paying a dividend, Payout Corp. announces that it will repurchase stock with a market value of $10,000. What happens to the stock price when the repurchase proposal is announced? Suppose that the stock is repurchased immediately after the announcement. What would be the stock price after the repurchase? (d.)
- If a company had an issued ordinary share capital of £450,000, a share premium of £187,500, and a trading loss of £25,000, what would be the total of the shareholders' equity? A. £637,500 B. £600,000 C. £662,500 D. £612,500Q. 41. The issued share capital of a company consists of 24,640 ordinary shares of £1 each. Half way through its financial year the company made a rights issue of 1 for 11 at an exercise price of £1.58 a share. The market value of the company's shares was £2.15 a share just before the rights issue.. The company reported a net profit after taxation for the year of £7,392. The market value of each ordinary share at the end of the year was £2.94. Calculate the theoretical ex-rights value per share_______________. Q.42 The issued share capital of a company consists of 2,217,600 ordinary shares of £1 each. Half way through its financial year the company made a rights issue of 1 for 11 at an exercise price of £1.88 a share. The market value of the company's shares was £2.23 a share just before the rights issue.. The company reported a net profit after taxation for the year of £887,040. The market value of each ordinary share at the end of the year was £3.08. The…Example: What is the multi-year holding period return for this share - Initial share price was £1, (P3) was £1.20 A dividend of 6p was paid at the end of Year 1 (D₁), 7p was paid at the end of Year 2 (D₂) and 8p was paid at the end of Year 3 (D3) ● Year 0 1 2 3 3 NPV Cash flow (pence) (100) 6 7 8 120 DF @ 12% DCF DF @13% DCF
- Assume that you have just purchased some shares in an investment company reporting $975 million in assets, $75 million in liabilities, and 75 million shares outstanding. What is the net asset value (NAV) of these shares? $14 $1 $12 $13QUESTION 4B (5 marks): Magnum Ltd has the following capital structure:Ordinary Equity: 68 000 ordinary shares outstanding at a market price of $35 per share. Theshares have just paid a $1.85 annual dividend and have a dividend growth rate of 2.5%.Preference Equity: There are 15 000 preference shares with an 8% dividend rate, outstanding ata market price of $75 a share. The preference shares have a par value of $100.Debts: The outstanding bonds mature in 20 years, have a total face value of $850 000, a facevalue per bond of $1000 and a market price of $1196.4 each. The bonds have before tax YTM8%. The marginal tax rate of the firm is 35%. Required:a) Calculate the current market value (rounded off to the nearest whole number). (2 marks) b) Calculate the capital structure of the company. Identify the total weights of equityfunding (rounded off to two decimal places) (1 mark) c) Compute the weighted average cost of capital (WACC) under the traditional tax systemfor the company, using…5. You are given the following information for company's Financial: Long-term debt outstanding: Current yield to maturity (r debt): Number of shares of common stock: Price per share: Book value per share: Expected rate of return on stock (requity): a) Computed company's cost of capital. Ignore taxes. $300,000 8% 10,000 $50 $25 15%
- Question 1 The following information relates to a company listed on Luse- Mungwi PLC ZMK Issued share capital (1000 shares) Share premium. Reserves. Share holders funds. 6% Irredeemable Debentures. 9% Redeemable Debentures. Bank loan. Total Long Term Liabilities. Million 4 000 2 600 290 6,890 2,800 2,900 1 000 6 700 The current cum interest market value per k100 units is k103 and k105 fir the 6% and 9% Debentures respectively. The 9% Debenture is redeemable at par in 10 years time. The bank loan bears interest rate of 2% above the base rate (current base rate is 15%). The current ex-div market price of shares is k1, 100 and a dividend of K100 per share which is expected to grow at a rate of 5% per year has just been paid. The effective corporation tax rate for Mungwi is 30%. Required: A) Calculate the effective after tax weighted Average Cost of Capital (WACC) fir Mungwi PLCCase study 3: Victory SAOG is registered with an authorized capital of OMR 50 million ordinary shares of 100 baiza each. The company had issued and paid up capital of OMR 33 million. In the year 2017 Victory SAOG has an outlined share repurchase program which would enable the company to repurchase at least 10 per cent of its outstanding shares. The company had an opening balance of OMR 55 million in its retained earnings account. After completing the required formalities for such repurchase in the vear 2017, the company was able to repurchase the 19.8 million shares valued at OMR 31,680,000 in the month of August. Later in the year 2019 the company was able to repurchase another 10 million shares for OMR 15 million in July. The following are the profits earned by the company over the period of 2017 to 2019: OMR in Millions' 2017: 110 2018: 150 2019: 160 The company decided to distribute dividends as mentioned below: #Interim dividend: 2017: Nil 2018:5% 2019:Nil #Final dividend:…The market value of the stock of shine corporation at the beginning of year one is 120 per share at the beginning of your two is 130 pesos it declares dividends of 24 share what is the holding period return from the said investment