Conversion value = 59.148
Conversion value = Convertion ratio * Current market price of underlying stock
Convertion ratio = 1.8
Current market price of underlying stock = 32.86
Conversion value = 1.8 * 32.86 = 59.15
Find the conversion value of a convertible preferred stock that carries a conversion ratio of 1.8,...
Check My Work eBook Problem Walk-Through Convertible Premiums The Tsetsekos Company was planning to finance an expansion. The principal executives of the company all agreed that an industrial company such as their should finance growth by means of common stock rather than by debt. However, they felt that the current $35 per share price of the company's common stock did not reflectits true worth, so they decided to convertible security. They considered a convertible debenture but feared the burden of...
Convertible Premiums The Tsetsekos Company was planning to finance an expansion. The principal executives of the company all agreed that an industrial company such as theirs should finance growth by means of common stock rather than by debt. However, they felt that the current $35 per share price of the company's common stock did not reflect its true worth, so they decided to sell a convertible security. They considered a convertible debenture but feared the burden of fixed interest charges...
Conversion (or stock) value What is the conversion (or stock) value of each of the following convertible bonds? a. A $1,000-par-value bond that is convertible into 25 shares of common stock. The common stock is currently selling for $50.00 per share. b. A$1,000-par-value bond that is convertible into 12.5 shares of common stock. The common stock is currently selling for $42.00 per share. c. A$1,000-par-value bond that is convertible into 100 shares of common stock. The common stock is currently...
A certain 6% annual coupon rate convertible bond (maturing in 20 years) is convertible at the holder's option into 20 shares of common stock. The bond is currently trading at $800. The stock (which pays 58¢ a share in annual dividends) is currently priced in the market at $30.61 a share. a. What is the bond's conversion price? b. What is its conversion ratio? c. What is the conversion value of this issue? What is its conversion parity? d. What...
Please A B and C :) Thanks Will thumbs up Conversion (or stock) value What is the conversion (or stock) value of each of the following convertible bonds? a. A $1,000-par-value bond that is convertible into 25 shares of common stock. The common stock is currently selling for $50.00 per share. b. A $1,000-par-value bond that is convertible into 12.5 shares of common stock. The common stock is currently selling for $42.00 per share. c. A $1,000-par-value bond that is...
Conversion price Calculate the conversion price for each of the following convertible bonds: a. A $1,000-par-value bond that is convertible into 40 shares of common stock. b. A$1000-par-value bond that is convertible into 25 shares of common stock. c. A $1,000-par-value bond that is convertible into 125 shares of common stock. a. The conversion price is $ per share. (Round to the nearest cent.)
Conversion price Calculate the conversion price for the following convertible bond: A $700-par-value bond that is convertible into 25 shares of common stock. The conversion price is $_______ per share. (Round to the nearest cent.)
The Tsetsekos Company was planning to finance an expansion. The principal executives of the company all agreed that an industrial company such as theirs should finance growth by means of common stock rather than by debt. However, they felt that the current $45 per share price of the company's common stock did not reflect its true worth, so they decided to sell a convertible security. They considered a convertible debenture but feared the burden of fixed interest charges if the...
A certain 5% annual coupon rate convertible bond (maturing in 20 years) is convertible at the holder's option into 17 shares of common stock. The bond is currently trading at $790. The stock(which pays 56¢ a share in annual dividends) is currently priced in the market at $33.79 a share. QUESTIONS: HUGE THUMBS UP FOR CORRECT ANSWERS c. The conversion value of this issue is (blank) $ ? (Round to the nearest cent.) d.. The conversion premium in dollars is...
ABC Corporation issued 1000 shares of $100 convertible preferred stock at $30000 premium. Each share of preferred stock could be converted to 100 shares of $1 par common stock. Prepare the following journal entries: A. Sales of the convertible preferred stock B. Conversion of all the preferred stock to common stock C. How would journal entry B. change if the par value of the preferred stock plus the premium in the additional paid-in capital associated with the preferred stock had...