Why is book value often meaningless

Reference no: EM131318366

1. Why is book value often meaningless? What improvements to financial statements would make it more meaningful?

2. Why should an investor read the note concerning stock options? How might stock options affect profitability?

3. Why can a relatively small number of stock appreciation rights prove to be a material drain on future earnings and cash of a company?

4. Explain how outstanding stock appreciation rights could increase reported income in a particular year.

Reference no: EM131318366

Questions Cloud

What is the cost of equity capital : Gangland Water Guns Company is expected to pay a dividend of $2.10 one year from today. If the firm's growth in dividends is expected to remain at a flat 3 percent forever, then what is the cost of equity capital (in percent) for Gangland if the p..

How does the social concept of race relate to each group : How has U.S. society used each group's culture to construct the group identity? How has each group been stereotyped? How accurate are these stereotypes? How does the social concept of race relate to each group? What prejudice has each group faced

How could you measure much stretch in a bolt of this size : The bolt of problem 1 is put in service and its temperature rises to 2508F. How much change in length of the bolt would you expect this increase in temperature to create?

Straight-line depreciation to a zero balance : Expected to have a useful life of 20 years At the end of the project the building and its equipment are expected to be sold for a $200,000 salvage value The building and its equipment will be depreciated over their 20-year life using straight-line de..

Why is book value often meaningless : Why can a relatively small number of stock appreciation rights prove to be a material drain on future earnings and cash of a company?

Calculate the degree of financial leverage : McDonald Company shows the following condensed income statement information for the current year:- Calculate the degree of financial leverage.

Standard deviation of the minimum variance portfolio : The stock of Bruin, Inc., has an expected return of 22 percent and a standard deviation of 35 percent. The stock of Wildcat Co. has an expected return of 14 percent and a standard deviation of 40 percent. The correlation between the two stocks is ..

Expression of variance on a asset portfolio : How many variance and covariance terms does the expression of variance on a 5 asset portfolio have?

Does the addition of the external load endanger the bolt : Does the addition of the external load endanger the bolt? Sketch an alternate form for joint diagram for this situation ? Define the ‘‘critical external load.'' Approximately what would you expect it to be for this joint?

User Account

All Pages