Question

Select a Fortune 500 company whose name starts with the first letter in your last name and obtain the company’s most recent 10-K report. (You may use the same company that you used previously.) Be sure that the company has a complex capital structure. Attach the equity section of the balance sheet and the notes relevant to answering the following questions:

(a) Does the company have preferred stock and common stock (or different classes of common stock)? Do its stocks have a par or stated value; if so, what are they? How many of each type of stock are authorized and have been issued? What is the average issue price?

(b) Were any shares issued in any of the years reported in the financial statements? At what price?

(c) What dividends were paid in each of the years reported in the financial statements? What is the payout ratio?

(d) Does the company have a stock-based compensation plan? How many options are outstanding? When do they expire? Were any options exercised during any of the years reported in the financial statements? At what exercise price?

(e) What number of shares was used to compute the diluted earnings per share in each of the years reported? What elements caused the dilution? Were there any convertible securities or other potentially dilutive items that were not included in the computation of diluted earnings per share? If so, explain why they were excluded. Does the company follow the required GAAP disclosure for earnings per share?

Answer 1

Answer:-

The most recent 10-K report for Raytheon Is for the year 2016.

(a) :-

• The organization just has basic stock ,and no favored stock or different classes of offers.
• Expressed standard estimation of a typical stock is $0.01 per share .
• $1,450 million offer have been approved and $293 million offers are exceptional as on December 31, 2016.

Normal issue cost = (3 + 398 )/293

= 401/293

= $1.368

Normal issue cost = $1.368

(b) :-

• No crisp offers were issued in 2015 and additionally in 2016.
• In reality in both these years Raytheon repurchased regular stock under its offer repurchase program.

(c) :-

• A profit of $850 was paid in 2016 and $797 millions in 2015.
• Dividend payout proportion = Dividend/net pay .

	2016	2015
Dividend	$850 millions	$797 millions
Net income	$2,174	$2,067
Dividend payout ratio	= 850 / 2,174 = 0.3909 = 39.09%	= 797 / 2,067 = 0.3855 = 38.55%

(d) :-

• Truly, the organization has a stock-based pay plan. number of offers accessible for new honors under stock - based pay plan toward the finish of 2016 was $6.7 million shares.
• Weighted normal exercise cost isn't given as RSU's don't have an activity cost.

(e) :-

• In 2016 $296.8 million offers and in 2015 305.2 millions offers were utilized to finish weakened profit per share.
• The components that caused weakening are stock arrangement exercises and offer repurchases.
• Exceptional RSA's, RSU's , and LTPP is incorporated into calculation of weakened offers. No there were no convertible securities.
• According to U.S GAAP organizations are required to display EPS for an uncommon thing on the essence of the pay proclamation or in the notes to the money related; explanations.
• For this situation Raytheon is announcing EPS from proceeding with tasks and from ceased activities.
• In this way Raytheon is following GAPP revelation for EPS.