Kenny Limited's issued share capital is £125,000 made up of 250,000 ordinary shares of £0.50 each. In the year to 31 October 2020, Kenny Limited makes the following profits: Profit before tax: £95,000 Profit for the year: £70,000 Kenny Limited has no preference shares in issue. What are the earnings per share of Kenny Limited for the year ended 31 October 2020?
Q: Central banks have injected moral hazard into global markets through 'bail-outs' and as lenders of…
A: The statement suggests that central banks, by providing bail-outs and acting as lenders of last…
Q: A firm evaluates all of its projects by applying the NPV decision rule. A project under…
A: Net Present Value (NPV) is a financial measure that evaluates the profitability of an investment by…
Q: Umunat is considering investing $50,000 in a new machine with an expected The machine will have no…
A: Capital budgeting refers to the process of evaluating and selecting long-term investment projects…
Q: Knight Supply Corp. has not grown for the past several years and management expects this lack of…
A: Current Value of Stock = Dividend / Required Rate of Return
Q: Problem =at: Two accountr 9ach began with s deposit of $10.000 . Bosh accountr have rates of 6,5% ,…
A: The compounding frequency is the number of times in a year that the amount deposited by the investor…
Q: A stock has a beta of 1.21 and an expected return of 11.9 percent. A risk-free asset currently earns…
A: Beta of portfolio = 2.41Stock beta = 1.21Stock A expected return = 11.9%Risk-free asset return =…
Q: 5. Regular Dividends The balance sheet lö terms. There are 12,000 shares of stock outstanding.…
A: When the company receives profits and distributes them among the shareholders. That share of profit…
Q: Compute the NPV statistic for Project Y if the appropriate cost of capital is 12 percent. (Negative…
A: NPV of a project refers to the measure of the profitability of the project by discounting future…
Q: Milan Ltd. wants to purchase a new machine for its factory operations at a cost of £380,000. This…
A: A financial metric called Net Present Value (NPV) is used to evaluate a project's or investment's…
Q: Great Lakes Packing has two bond issues outstanding. The first issue has a coupon rate of 3.60…
A: A bond is a type of debt security issued by governments and private companies to raise funds from…
Q: C. Recently, Emily won a lottery with the amount of RM50,000. She quickly bought a share of LUSTER…
A: Call option provides the buyer the right and not obligation to buy underlying asset at the specified…
Q: The Gecko Company and the Gordon Company are two firms that have the same business risk but…
A: Dividend is the part or share of profits which is being distributed to shareholders. Several models…
Q: Joe Gallegos purchased a calculator for $14.18 and paid with a $20 bill. How much change did he get?
A: To calculate the change that Joe Gallegos has received, we need to subtract the cost of the…
Q: 1. A project that provides annual cash flows of $1,200 for nine years costs $6,000 today. Is this a…
A: Data given: Annual cash flow=$1200 N=9 years Initial investment= $6000
Q: John and Daphne are saving for their daughter Ellen's college education. Ellen just turned 10 (at t…
A: Annuity refers to series of equalized payments that are paid or received at start or ending of…
Q: Suppose the real risk-free rate of interest is r*=4%�*=4% and it is expected to remain constant over…
A: Real risk free rate = 4%Inflation (first 2 years) = 1.6%Inflation (next 3 years) = 3.90%Maturity…
Q: ur five-year old daughter has just announced that she would like to attend college. Your best…
A: Present value is the equivalent value today based on the time and interest rate of future payments…
Q: a. What is the net present value of the project? (Negative amount should be indicated by a minus…
A: Calculation of Net present value:Step 1: Initial capital outflow = cost of equipment + working…
Q: On January 1, 2014, Pop Corp. Issued 3,000 of its 9 %, P 1,000 bonds when the prevailing rate of…
A: Bonds are always amortized on the balance sheet to the face value on maturity. Bonds offering higher…
Q: A restaurant forecast $70,000 in food sales for a year and wants to run a food cost cost percent of…
A: Sales forecast means estimated sales revenue to be earned by business. Budget is a form of…
Q: Calculate the standard deviations in estimated rates of return for TI, SG and market
A: We can determine the expected return and standard deviation of the asset using the formula below:
Q: Benefits of diversification Sally Rogers has decided to invest her wealth equally across the…
A: Here,State of EconomyProbablityReturn- Asset MReturn- Asset NReturn- Asset…
Q: What are the relationship between y1 and y2, U1 and U2:
A: We can determine the weight in optimal risky asset using the formula below:In the above formula,ER =…
Q: ABC, Inc., invested in a machine with a useful life of 6 years and no salvage value. The machine was…
A: At the internal rate of return of 10%, the PV of annual cash inflows will equal the initial…
Q: Assume that you have taken out an amortized loan for $10,000 to buy a new car. The yearly interest…
A: Principal Loan Amount = p = $10,000Compound = monthly = 12Interest rate = r = 18 / 12 = 1.5%Time = t…
Q: Calculate the project profitability index for each product. 2. Calculate the simple rate of return…
A: Profitability index of a project is calculated as shown below.Simple rate of return of a project is…
Q: ch of the following loan types has a beginning loan balance equal to the ending loan balance? Group…
A: Loans are kind of debt and burden and that carry the interest to be paid but when interest is to be…
Q: What is the present value of $4,000 paid each year forever, assuming a discount rate of 7% and the…
A: The formula to calculate present value of perpetuity isPV of perpetuity=Cash flow/Discount rate
Q: Warr Company is considering a project that has the following cash flow data. What is the project's…
A: NPV is sum of present value of cash flows.Present value of cash flows = Cash flows/(1+discount…
Q: Emerson, Inc. is evaluating whether to replace a machine. The current machine was purchased 3 years…
A: NPV is also known as Net Present Value. It is a capital budgeting techniques which help in decision…
Q: A company has a 11% WACC and is considering two mutually exclusive investments (that cannot be…
A: The difference between IRR & MIRR is the assumption relating to the re-investment of cash flows…
Q: CELFIN S.A. is not a publicly traded company and is faced with determining cost of capital rate to…
A: An equity illiquidity premium is a premium charged while calculating the required return on equity…
Q: Assume Bill Jones invested $ 2,160.57 into an account exactly one year ago. The account has an…
A: Present value, PV = $2,160.57Interest rate, r = 5.9% Period, n = 1 yearThe formula for calculating…
Q: You are considering investing in ICI. Suppose ICI is currently undergoing expansion and is not…
A: Current Dividend = d0 = $3Growth rate for first 4 years = g4 = 0%Growth rate for Next 3 years = g3 =…
Q: What is the cash-flow cost of hedging translation exposure with a currency option: The option…
A: When a company hedges translation risk with a currency option, the amount of cash costs incurred by…
Q: To buy a car, Mr. Gómez obtains a loan of $200,000 with interest of 15% per year, compounded…
A: Loan = $200,000Interest = 15% compounded bi-weeklyBi-weekly payments = $4700
Q: Stern Associates is considering a project that has the following cash flow data. What is the…
A: years cashflows cumulative cashflow 0 (950) (950) 1 380…
Q: Kyle is considering an investment with the following cash flows: Net Cash Flow Year ($250,000)…
A: NPV refers to net present value. It is the sum of present values of all cash flows involved in a…
Q: 1. Bond prices and yields (S3.1) A 10-year bond is issued with a face value of $1,000, paying…
A: If interest rate of a bond increase after the bond is issued, the coupon rate will not change…
Q: A pension fund manager is considering three mutual funds. The first is a stock fund, the second is a…
A: The optimal risky portfolio refers to a mix of assets such that the return provided is maximized for…
Q: ) Why 25% tax rate in statement not considered for incorporation into cost of debt? i.e. kd x (1 -…
A: After tax cost of debt is calculated as shown below.
Q: (10). The table below presents the price of stock A and the points of a market index over the last…
A: Holding period returns:The holding period return measures the return earned by an investor from the…
Q: Assume we have a $500,000 mortgage at a 3.5% original interest rate, 30-year term, and monthly…
A: Loan (mortgage) amortization schedule refers to a schedule which is prepared to show the periodic…
Q: what is the effective rent for a 6-year net lease with a fixed at $24/sf in which the landlord…
A: Discounting rate = 8%Lease period = 6 YearsRent free period = 1 YearPay of tenant Improvement =…
Q: You want to withdraw $ 54,777 from your account at the end of one year and $ 10,521 at the end of…
A: As per the given information:Withdrawals at the end of the one year = $54,777Withdrawals at the end…
Q: You are considering two projects with the following cash flows: Project X Project Y Year 1 $7,000…
A: As per the concept of time value of money we need to discount the cash flows to compute the present…
Q: A company considering a project with extremely risky cash flows decides to apply a premium to the…
A: CV is an indicator that can be used to add a premium to the WACC. The final value of WACC depends…
Q: NeuroDyne Corporation (NDC) currently has a 100% dividend payout ratio, pays a dividend of $5 per…
A: Current dividend payout ratio = 100%Expected dividend = $5Required rate of return = 8%Revised payout…
Q: OpenSeas, Inc. is evaluating the purchase of a new cruise ship. The ship will cost $499 milion and…
A: Capital budgeting refers to the process of evaluating and selecting long-term investment projects…
Q: A company with EBIT of $8,500 and interest expense of $1,500 wants to maintain a fixed charge…
A: Fixed charge coverage ratio show that how much the company can pay the fixed charges without much…
Kenny Limited's issued share capital is £125,000 made up of 250,000 ordinary shares of £0.50 each. In the year to 31 October 2020, Kenny Limited makes the following profits: Profit before tax: £95,000 Profit for the year: £70,000 Kenny Limited has no
Step by step
Solved in 3 steps
- Junior plc is a company that, during the year ended 31 December 2020, paid $25,000 debenture interest and paid an ordinary dividend of 8 pence per share on 1 million £1 ordinary shares. The retained profit for the year was $160,000. What was Junior plc's profit for the year? Select one: a. $80,000 b. $215,000 c. $240,000 d. $265,000For the year ending 30 June 2020, Don Ltd reports a net profit after tax of $6.1 million. At the beginning of the financial year Evita Ltd had 2,500,000 fully paid ordinary shares outstanding. Don Ltd also had 1,000,000 partly paid shares. These shares were partly paid to 0.50 cents and had an original issue price of $1. The partly paid shares carry the rights to dividends in proportion to the amount paid relative to the total issue price. They were still partly paid at year end. Don Ltd also has the following securities outstanding: • $2.0 million of 10 per cent notes issued on 1 July 2019. The notes have a life of five years and give holders the right to convert the notes into 500,000 fully paid ordinary shares. • In 2016, employees were provided with options, at no initial cost, which gave them the right to acquire 750,000 shares at an exercise price of $2.50. The options expire five years after their original issue date. Given the time period to option expiry, the directors believe…Senior plc is a company that ,during the year ended 31 December 2019,paid Gh 25,000 debanture interest and paid an ordinary dividend of 8 pesewas per share on 1 million, Gh 1 ordinary shares. The retained profit for the year was Gh 160,000. What was junior PLC's profit for the year ?
- Senior plc is a company that, during the year ended 31 December 2019, paid GH₵ 25,000 debenture interest and paid an ordinary dividend of 8 pesewas per share on 1 million GH₵ 1 ordinary shares. The retained profit for the year was GH₵ 160,000. What was Junior plc's profit for the year?ABC Ltd is an Australian listed company. Its results for the financial year ending 30 June 2019 have exceeded expectations—profit before tax is $5.597 million and income tax expense is $1.847 million. As at 30 June 2018, there were 9.75 million ordinary shares on issue. On 11 May 2019, 3.25 million further ordinary shares were issued at a price of $2.30—paid to $2.00. The partly paid shares carry rights to dividends in proportion to the amount paid relative to the total issue price. Required: Calculate the weighted number of shares outstanding at the end of the year Calculation of Adjusted net income Calculation of basic EPS for ABC Ltd for the year ending 30 June 2019Beach Ltd has a net income after tax of $1 000 000 for the year ended 30 June 2023. At the beginning of the period, Beach Ltd has 900 000 fully paid-up ordinary shares on issue. On 1 December 2022, Beach Ltd had issued a further 300 000 fully paid-up ordinary shares. At the beginning of the current period, Beach Ltd also had 500 000, $1.00, 5% cumulative preference shares on issue. The dividends on the preference shares are not treated as expenses in the statement of comprehensive income. The 500 000 cumulative preference shares can be converted into 250 000 ordinary shares at the option of the preference shareholders. Required: (a) Compute the basic earnings per share amount for 2023 (rounded to 2 decimals). (b) Decide whether the preference shares are dilutive or not by showing your working
- Koala Ltd reports a net profit after tax of $1400 000 for the year ending 30 June 2022. At the beginning of the financial year 1 st July 2021, Koala Ltd had 1000 000 fully paid ordinary shares on issue. It also had 400 000 $1.00,10%, cumulative preference shares outstanding. On 1 October 2021 the company issued a further 200 000 fully paid ordinary shares. On 1 May 2022 the company issued further fully paid shares on the basis of a one-for-six bonus issue. The last sale price per ordinary share prior to the bonus issue was $4.00 The basic EPS for the year ending 30 June 2021 was 180 cents. Required: a) Calculate the theoretical ex-bonus price and adjustment factor. b) Compute the basic EPS amount for year ended 30 June 2022 c) Compute the adjusted comparative EPS for year ended 30th June 2021ABC LTD's profit after tax for an accounting period is R12m. The company's issued share capital consists of 50m ordinary shares of 50 cents each and 10m preference shares of R1 each. The preference dividend is R1m. Earnings per share for the period are, 33.3 cents, 20 cents, 44 cents or 22 cents.Compaq Ltd has a net income after tax of $2 000 000 for the year ended 30 June 2018. At the beginning of the period Compaq Ltd has 900 000 fully paid-up ordinary shares on issue. On 1 January 2018 Compaq Ltd had issued a further 300 000 fully paid-up ordinary shares at an issue price of $2.00. On 1 March 2018 Compaq Ltd made a one-for-five bonus issue of ordinary shares out of retained earnings. The last sale price of an ordinary share before the bonus issue was $2.50. At the beginning of the current period Compaq Ltd also had 500 000, $1.00, 5% cumulative preference shares on issue. The dividends on the preference shares are not treated as expenses in the statement of comprehensive income. The basic earnings per share for the period ended 30 June 2017 was $1.50 per share. Required:Explain what is diluted EPS. Give one example of a security that can dilute the basic EPS
- Compaq Ltd has a net income after tax of $2 000 000 for the year ended 30 June 2018. At the beginning of the period Compaq Ltd has 900 000 fully paid-up ordinary shares on issue. On 1 January 2018 Compaq Ltd had issued a further 300 000 fully paid-up ordinary shares at an issue price of $2.00. On 1 March 2018 Compaq Ltd made a one-for-five bonus issue of ordinary shares out of retained earnings. The last sale price of an ordinary share before the bonus issue was $2.50. At the beginning of the current period Compaq Ltd also had 500 000, $1.00, 5% cumulative preference shares on issue. The dividends on the preference shares are not treated as expenses in the statement of comprehensive income. The basic earnings per share for the period ended 30 June 2017 was $1.50 per share.Calculate the basic EPS amount for 2018.Compaq Ltd has a net income after tax of $2 000 000 for the year ended 30 June 2018. At the beginning of the period Compaq Ltd has 900 000 fully paid-up ordinary shares on issue. On 1 January 2018 Compaq Ltd had issued a further 300 000 fully paid-up ordinary shares at an issue price of $2.00. On 1 March 2018 Compaq Ltd made a one-for-five bonus issue of ordinary shares out of retained earnings.The last sale price of an ordinary share before the bonus issue was $2.50. At the beginning of the current period Compaq Ltd also had 500 000, $1.00, 5% cumulative preference shares on issue. The dividends on the preference shares are not treated as expenses in the statement of comprehensive income. The basic earnings per share for the period ended 30 June 2017 was $1.50 per share.Required:a) Calculate the basic EPS amount for 2018. b) Explain what is diluted EPS. Give one example of a security that can dilute the basic EPS.