User Account

All Pages

What is the conversion ratio of the debenture

Assignment Help Accounting Basics
Reference no: EM133122570

Question - Maple Aircraft has issued a 4¾% convertible subordinated debenture due 3 years from now. The conversion price is $47.00 and the debenture is callable at 102.75% of face value. The market price of the convertible is 91% of face value, and the price of the common is $41.50. Assume that the value of the bond in the absence of a conversion feature is about 65% of face value.

Required -

In the absence of the conversion feature, what is the current yield and yield to maturity?

What is the conversion ratio of the debenture?

If the conversion ratio were 50, what would be the conversion price?

What is the conversion value?

At what stock price is the conversion value equal to the bond value?

Can the market price be less than the conversion value?

How much is the convertible holder paying for the option to buy one share of common stock?

By how much does the common have to rise after 3 years to justify conversion?

Reference no: EM133122570

Questions Cloud

Different stock exchanges : Identify two different stock exchanges in the United States. Describe the similarities and differences between the two stock exchanges.
Steps in financial planning process : Write and explain the 6 steps in Financial Planning process for your own Business (Choose any business).
What is the return on assets for the company : i). Assuming a corporate tax rate of 25%, what is the Net Income of the company for both years?
Data governance involves the supervision-monitoring : Data governance involves the supervision, monitoring, and control of an organization's data assets.
What is the conversion ratio of the debenture : The market price of the convertible is 91% of face value, and the price of the common is $41.50. What is the conversion ratio of the debenture
What is the amount of dividends in arrears : This year, Rale paid $400,000 in dividends. What is the amount of dividends in arrears that is still owed to preferred stockholders?
Record the transactions at the fair value of the goods : Forgin Co. Issued 500 common shares to We Can Advertize for advertising services. Record the transactions at the fair value of the goods
Opportunities and threats-blue cross blue shield : Research sources with information about the organization, social media sites, which may include customer reviews of the organization
Calculate phyllis mortgage payment : Phyllis age 43 earns $220,000 with a 50% MTR has a few planning issues she has approached you about. Phyllis's mortgage is renewing this month in the amount of

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much control does fed have over this longer real rate

Hubbard argues that the Fed can control the Fed funds rate, but the interest rate that is important for the economy is a longer-term real rate of interest.   How much control does the Fed have over this longer real rate?

  Coures:- fundamental accounting principles

Coures:- Fundamental Accounting Principles: - Explain the goals and uses of special journals.

  Accounting problems

Accounting problems,  Draw a detailed timeline incorporating the dividends, calculate    the exact Payback Period  b)   the discounted Payback Period. the IRR,  the NPV, the Profitability Index.

  Theory of interest - term structure of interest rates

Term Structure of Interest Rates

  Write a report on internal controls

Write a report on Internal Controls

  Prepare the bank reconciliation for company

Prepare the bank reconciliation for company.

  Cost-benefit analysis

Create a cost-benefit analysis to evaluate the project

  Theory of interest

Theory of Interest: NPV, IRR, Nominal and Real, Amortization, Sinking Fund, TWRR, DWRR

  Liquidity and profitability

Distinguish between liquidity and profitability.

  What is the expected risk premium on the portfolio

Your Corp, Inc. has a corporate tax rate of 35%. Please calculate their after tax cost of debt expressed as a percentage. Your Corp, Inc. has several outstanding bond issues all of which require semiannual interest payments.

  Simple interest and compound interest

Simple Interest, Compound interest, discount rate, force of interest, AV, PV

  Capm and venture capital

CAPM and Venture Capital

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!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

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