# An analyst gathers the following information about Meyer, Inc.: Meyer has 1,000 shares of 8% cumulative preferred stock outstanding, with a par value of \$100 and liquidation value of \$110. Meyer has 20,000 shares of common stock outstanding, with a par value of \$20. Meyer had retained earnings at the beginning of the year of \$5,000,000. Net income for the year was \$70,000. This year, for the first time in its history, Meyer paid no dividends on preferred or common stock.What is the book value per share of Mayer's common stock?

common stock book value: 273.5 dollars

Explanation:

(equity - preferred stock) / outstanding shares

In this case:

(common stock + RE)  divide over shares outstanding

20,000 shares x \$ 20 = 400,000

Retained Earnings:

5,000,000 + 70,000 = 5,070,000

Total Common Equity: 5,470,000

Common stock: 20,000

5,470,000 / 20,000 = 273.5

The book value per share of Meyer's common stock is \$253.5. This is calculated by dividing the total equity (\$5,070,000) by the number of common shares outstanding (20,000).

### Explanation:

The book value per share is the value of a company's equity divided by the total number of common shares outstanding. It is a financial ratio that investors use to assess whether a company's stock is overpriced or underpriced.

In this case, the total equity of Meyer, Inc. is calculated by adding its retained earnings to its net income for the year. This totals to \$5,070,000. Since there are 20,000 shares of common stock, the book value per share of Meyer's common stock would be \$5,070,000 divided by 20,000, which equals to \$253.5.

This represents the intrinsic value of a company, which could be significantly different from its market price depending on numerous factors such as the company's earnings potential and risk profile.

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## Related Questions

Tresnan Brothers is expected to pay a \$1.60 per share dividend at the end of the year (i.e., D1 = \$1.60). The dividend is expected to grow at a constant rate of 3% a year. The required rate of return on the stock, rs, is 5%. What is the stock's current value per share? Round your answer to the nearest cent.

The price of the stock today is \$80.00

Explanation:

The price of a stock whose dividends are expected to grow at a constant rate is calculated by the constant growth model of the DDM. The price of a stock under DDM is based on the present value of the expected future dividends that the stock will pay. The formula for price under this model is,

P0 = D1 / r - g

Where,

• D1 is the dividend expected for the next period
• r is the required rate of return
• g is the growth rate in dividends

P0 = 1.6 / (0.05 - 0.03)

P0 = \$80.00

You are searching for the details of a refrigerator in Google. When you perform the search, advertisements by home appliance manufacturers appear above the organic search results displayed by Google. These advertisements link you to the online appliance store of the companies.

C) interstitials
D) superstitials

Explanation:

Banner ads are rectangular publications portrayed at the top, bottom, left or right side of a website to promote products or services on a website different from the one the goods are sold. Banner ads invite visitors to go into the advertiser's website to dive into its gamma of products offered.

### Explanation:

The advertisements that appear above the organic search results when you're searching for the details of a refrigerator are referred to as pay-per-click ads (option A). These are a type of online advertising where the advertiser pays a fee each time their ad is clicked by a user. The search engine makes use of this advertising model for its ads, which are strategically placed to attract potential buyers. Other options like floating ads, interstitials, superstitials, and banner ads are also types of online advertisements but they have different characteristics and are used in different contexts.

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Which of the following meetings would be subject to the open-meeting provisions of the federal Sunshine laws? a. a meeting of the staff attorneys of the SEC enforcement division b. a meeting of the nine justices of the U.S. Supreme Court c. a meeting of the division heads of the Federal Trade Commission d. a meeting of three of the five commissioners of the Federal Aviation Administration

The correct answer is D. a meeting of three of the five commissioners of the Federal Aviation Administration.

Explanation:

Sunshine laws are regulations that require openness in government or business. Sunshine laws make public meetings, records, voting, deliberations and other official actions available for observation, participation and / or inspection. Sunshine laws also require that government meetings be held well in advance and at times and locations that are convenient and accessible to the public, with exceptions for emergency meetings.

In some cases, an event or document that would normally be accessible through the laws of sunlight is closed to public access (as a legally protected matter currently under investigation), but the laws of sunlight are supposed to minimize these exceptions. . Sunshine's laws also differentiate entities that are subject to laws from those that are not. For example, any entity with authority to create binding laws would be subject to the law, but an advisory committee that lacks such authority may not be subject to the laws of sunlight, even if it deals with matters related to government.

d. a meeting of three of the five commissioners of the Federal Aviation Administration.

Explanation:

Federal Sunshine law was passed in the U.S in the year 1976. It's sole purpose was to ensure that there is transparency in the federal government. This law applies to a country, state, political subdivisions and it makes meetings, voting, records and other official actions available to the public to observe, participate and inspect.

The meeting that would be subject to the open-meeting provisions of the federal sunshine laws would be a meeting of three of the five commissioners of the Federal Aviation Administration.

Cullumber Company purchases land for \$185000 cash. Cullumber assumes \$5200 in property taxes due on the land. The title and attorney fees totaled \$3100. Cullumber has the land graded for \$4100. They paid \$25000 for paving of a parking lot. What amount does Cullumber record as the cost for the land?

\$197,400.

Explanation:

The cost of acquisition of an asset (land) is the non-depreciable costs associated with the acquisition of the land, because land is considered as an asset that does not depreciate. The costs that make up the cost of acquiring a land includes the normal, reasonable and necessary expenditures associated with the land to obtain it and get it ready for use. These include the agreed upon cash price, repair and reconditioning costs, title fees, legal fees, zoning fees and survey fees. On the there are costs of improvements made on the land and this is not part of acquisition costs because these improvements depreciate with time, and they are recorded in the cost of improvement account which takes depreciation into consideration. Example of these costs include parking lots, irrigation systems etc.

Hence in this case, all the expenditures except the cost of paving a parking lot are recorded as cost of acquisition of the land, and these include:

cost of purchase         = \$185,000

property taxes             = \$    5,200

title and attorney fees = \$    3,100

cost of grading             = \$    4,100

Total                              = \$197,400

If there is a market with the below noted market segmentation, what would the four firm market concentration ratio be?Distribution of sales: 30%, 3%,10%, 5%,15%, 2%, 35%

a. 10
b. 90
c. 50
d. 40

90 (b.)

Explanation:

A concentration ratio is the ratio of the combined market shares percentage held by the largest specified number of firms, compared to the given market size. The concentration ratio ranges from 0% to 100%. If the concentration ratio of an industry ranges from 0% to 50%, that industry is said to be perfectly competitive if the top 5 firms have a concentration ratio of 60% or more, oligopoly is said to occur, and if the competition ratio of one company is 100% it shows monopoly.

In our example, the concentration of the largest four market segments are:

35%, 30%, 15% and 10%

Therefore, the four firm market concentration ratio = 35 + 30 + 15 + 10 = 90

b. 90

Explanation:

The concentration ratio is a term in business that is measured as the total summation of the market share percentage carried by the largest specified number of companies in an industry. The concentration ratio varies between 0% to 100%, and an industry's concentration ratio is considered to demonstrates the extent of competition in the industry.

However, the four-firm concentration ratio is calculated by summing the market shares—that is, the percentage of total sales—of the four largest companies in the given market.

Hence, in this case, we have 35%, 30%, 15% and 10% as the top four largest market share. There by, summation equals => 35+30+15+10 = 90.

Suppose Compco Systems pays no dividends but spent \$ 5.18 billion on share repurchases last year. If​ Compco's equity cost of capital is 11.5 %​, and if the amount spent on repurchases is expected to grow by 7.9 % per​ year, estimate​ Compco's market capitalization. If Compco has 5.8 billion shares​ outstanding, to what stock price does this​ correspond? ​Compco's market capitalization will be ​\$ nothing billion. ​(Round to two decimal​ places.) ​Compco's stock price will be ​\$ nothing. ​(Round to the nearest​ cent.)

Market capitalization - \$155.26

Stock price - \$26.77

Explanation:

The computation of the market capitalization is shown below:

= last year dividend × (1 + growth rate) ÷  (cost of capital - growth rate)

= \$5.18 billion × ( 1 + 7.9%) ÷ (11.5% - 7.9%)

= \$5.58,922 billion ÷ 3.6%

= \$155.26

And, the stock price would be

= Market capitalization ÷ outstanding shares

= \$155.26 ÷ 5.8 billion

= \$26.77