Use the Information for the Question(s)below

question 82

Multiple Choice

Use the information for the question(s) below.
Luther is a successful logistical services firm that currently has $5 billion in cash.Luther has decided to use this cash to repurchase shares from its investors,and has already announced the stock repurchase plan.Currently Luther is an all-equity firm with 1.25 billion shares outstanding.Luther's shares are currently trading at $20 per share.
-Assume that in addition to 1.25 billion common shares outstanding,Luther has stock options given to employees valued at $2 billion.After the repurchase how many shares will Luther have outstanding?

• A)1.0 billion
• B)1.2 billion
• C)0.75 billion
• D)1.1 billion

Understand and apply the double-declining-balance and straight-line methods of depreciation.

Distinguish between different types of assets: fixed assets, intangible assets, natural resources, and none of these.

Record and understand the effects of asset impairment, particularly goodwill impairment.

Understand and calculate depletion expense for natural resources.

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Definitions:

Promotion Design

The strategic development of marketing campaigns and materials that aim to communicate offers, increase brand awareness, and stimulate demand.

Consumers' Interests

The preferences and priorities of individuals in the marketplace, particularly relating to the types of goods and services they seek to purchase.

Competitive Parity Budgeting

A budgeting method where a company's advertising budget is set to match competitors' outlays to prevent market share loss.

Market Share

The segment of a market that is under the influence of a specific company or product.