Calculate total amount of dividends in arrears, Financial Management

Assignment Help:

QTL Tech has an issue of preferred shares outstanding with a $50 stated value that pays a dividend of 7.5%. There are 325,000 shares outstanding. QTL has not paid preferred share dividends for 3.5 years. The company's CEO wishes to retire the preferred share issue by paying the preferred shareholders 50% of the dividends in arrears plus 10% of the stated value of the preferred.

a. What is the total amount of dividends in arrears? Provide the per share and total dollars amounts.

b. If the preferred shareholders accepted the CEO's offer, what would be the total payment QTL Tech would have to make to the preferred shareholders on a per share and total dollar basis?

c. QTL Tech common shares are trading for $1.22 on the market. If the CEO offered to convert each preferred share into 5 common shares, would this be a better deal for the preferred shareholders?


Related Discussions:- Calculate total amount of dividends in arrears

Define the common pattern of cash flows, What is the common pattern of cash...

What is the common pattern of cash flows for a share of preferred stock? How does the market define the value of a share of preferred stock, specified these promised cash flows?

Demerits of net present value method, Q. Demerits of net present value meth...

Q. Demerits of net present value method? (i) Difficult to Understand as well as Implement:- This method is tricky to understand as well as implement in comparison to the paybac

Why do analysts calculate financial ratios, Why do analysts calculate finan...

Why do analysts calculate financial ratios? Ratios are comparative measures.  For the reason that the ratios show relative value, they permit financial analysts to compare inf

Operating budget, Operating Budget It is a collection or set of formal ...

Operating Budget It is a collection or set of formal financial documents that details expected expenses and revenues, as like all other expected operating and financial transac

Functions of treasurer, Functions of Treasurer:- (1) Cash Management: -...

Functions of Treasurer:- (1) Cash Management: - It comprises the managing of cash receipts and cash payments of the business. (2) Banking Relations: - It comprises operating

Conversion value, Conversion value is the amount which investors wi...

Conversion value is the amount which investors will receive by immediately exchanging the bonds for equity stock and selling the stock at prevailing market

Wcr expense ratios, Scenario:  ABC Company sells widgets in three varietie...

Scenario:  ABC Company sells widgets in three varieties (blue, red, and yellow) but has lost money for the past three years.  Competitive intelligence shows the Company's products

Bond features that affect interest rate risk, Various bond feat...

Various bond features largely affect the degree of correlation between the bond's prices and the bond's interest rates. Some of the bond feature

Financial management issue, Harrelson Inc. currently has $750,000 in accoun...

Harrelson Inc. currently has $750,000 in accounts receivable, and its days sales outstanding (DSO) is 55 days. It wants to reduce its DSO to 35 days by pressuring more of its custo

Describes the concept of time value of money, Q. Describes the Concept of T...

Q. Describes the Concept of Time value of Money? 'Time value of money' signifies that the value of a unit of money is different in different time periods. The worth of a sum of

Write Your Message!

Captcha
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!

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