Par value versus book value
[DOC File]Module 1 Instructor's Notes
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par. a discount. a premium. book value. A firm has an issue of $1,000 par value bonds with a 9 percent stated interest rate outstanding. The issue pays interest annually and has 20 years remaining to its maturity date. If bonds of similar risk are currently earning 8 percent, the firm's bond will sell for _____ today. $1,000 . $716.67 . $840.67
[DOC File]4 ASSIGNMENT, DEPRECIATION, AND AMORTIZATION OF …
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Therefore, the bond sells for 0.4071 times its par value, so that: Market value = Par value ( 0.4071. $5.8 million = Par value ( 0.4071 ( Par value = $14.25 million. Another way to see this is to note that each bond with par value $1000 sells for $407.11. If total market value is $5.8 million, then you need to buy: $5,800,000/407.11 = 14,250 bonds
[DOC File]Financial Management Name_______________________________
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a. ROA x Book value per share. b. ROE x Book value per share. c. ROA/ Book value per share. d. ROE/ Book value per share. (b, moderate) 19. The two components of EPS are. a. ROA and leverage. b. book value per share and leverage. c. ROE and book value per share. d. leverage and profit margin. (c, difficult) 20. The two components of ROE are. a.
[DOC File]Kim Book - Chapter questions
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Describe how market-value balance sheets differ from book-value balance sheets. Identify the basic equation for the income statement and the information it provides. Explain the difference between cash flows and accounting income. Explain the four major financial statements. Discuss the difference between average and marginal tax rates. Outline
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Market value = Market-to-book ratio = $800/$200 = 4. Now g falls to (0.10 ( 0.50) = 0.05, earnings decline to $20 million, and dividends decline to $10 million. Market value = Market-to-book ratio = ½. This result makes sense because the firm now earns less than the required rate of return on its investments. The project is worth less than it ...
What is the difference between Par Value, Book Value & Market Va…
Book Value versus Market Value. Book value per share may not equal market value. Book value is based on recorded costs. Market value reflects the subjective judgments of thousands of stockholders and prospective investors about the company’s …
Chapter 15
In practice this situation is less likely to be referred to as a “bargain” than the situation where BV>FV>Cost. Nonetheless it is the comparison between FV and Cost that determines a bargain, regardless of the level of BV (book value). APB Opinion No. 16 (par. 91).
[DOC File]Chapter 10
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Assume : par value = $ 1,000; maturity date = 5 years; annual coupon payments = $100 or 10%; and market interest rate = 8%. Use the above assumptions to determine (1) the present value of the coupon payments, (2) the present value of the par value, and (3) present value of a bond.
[DOC File]1 Identify the major characteristics of a corporation
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a. book value per share. b. par value per share. c. stated value per share. d. market value per share. *68. Dividends are not paid on. a. noncumulative preferred stock. b. nonparticipating preferred stock. c. treasury common stock. d. Dividends are paid on all of these. *69. Noncumulative preferred dividends in arrears. a. are not paid or ...
[DOC File]Godgift
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Premium is added to par value to produce the carrying (or book) value of the bonds payable. For example, a bond with a $1,000 par value, due in 5 years, with semiannual interest at 12% will sell for more than $1,000 if the market rate is 10%, compounded semiannually: Present value of $1,000 to be received in 10 periods, discounted at 5%
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