{"id":184885,"date":"2025-01-21T18:07:44","date_gmt":"2025-01-21T18:07:44","guid":{"rendered":"https:\/\/learnexams.com\/blog\/?p=184885"},"modified":"2025-01-21T18:07:46","modified_gmt":"2025-01-21T18:07:46","slug":"here-is-the-capital-structure-of-microsoft","status":"publish","type":"post","link":"https:\/\/www.learnexams.com\/blog\/2025\/01\/21\/here-is-the-capital-structure-of-microsoft\/","title":{"rendered":"Here is the capital structure of Microsoft"},"content":{"rendered":"\n<p>Here is the capital structure of Microsoft. What part of the $117.67 share price (to the nearest dollar) is represented by cash?<\/p>\n\n\n\n<p>a. $21<\/p>\n\n\n\n<p>b. $11<\/p>\n\n\n\n<p>c. $17<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img decoding=\"async\" src=\"https:\/\/learnexams.com\/blog\/wp-content\/uploads\/2025\/01\/image-371.png\" alt=\"\" class=\"wp-image-184886\"\/><\/figure>\n\n\n\n<p><strong><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-ast-global-color-6-color\">The correct answer and explanation is:<\/mark><\/strong><\/p>\n\n\n\n<p>\ue203To determine the portion of Microsoft&#8217;s $117.67 share price represented by its cash holdings, we can follow these steps:\ue204<\/p>\n\n\n\n<ol class=\"wp-block-list\">\n<li><strong>Identify Total Cash Holdings<\/strong>: \ue203As of Microsoft&#8217;s latest financial statement, the company reported total cash, cash equivalents, and short-term investments amounting to $107.26 billion.\ue204 \ue200cite\ue202turn0search6\ue201\ue206<\/li>\n\n\n\n<li><strong>Determine Shares Outstanding<\/strong>: \ue203The number of shares outstanding as of October 24, 2024, was approximately 7.434 billion shares.\ue204 \ue200cite\ue202turn0search20\ue201\ue206<\/li>\n\n\n\n<li><strong>Calculate Cash Per Share<\/strong>: \ue203By dividing the total cash holdings by the number of shares outstanding, we get:\ue204 \ue203Cash\u00a0per\u00a0share=$107.26\u2009billion7.434\u2009billion\u00a0shares\u2248$14.43\u2009per\u00a0share\\text{Cash per share} = \\frac{\\$107.26\\, \\text{billion}}{7.434\\, \\text{billion shares}} \\approx \\$14.43\\, \\text{per share}\ue204\ue206<\/li>\n\n\n\n<li><strong>Round to the Nearest Dollar<\/strong>: \ue203Rounding $14.43 to the nearest dollar gives us $14.\ue204\ue206<\/li>\n<\/ol>\n\n\n\n<p>\ue203Given the options provided:\ue204\ue206<\/p>\n\n\n\n<p>a. $21\ue206 b. $11\ue206 c. $17\ue206<\/p>\n\n\n\n<p>\ue203None of these options exactly match the calculated $14 per share. However, $11 is the closest to $14.\ue204\ue206<\/p>\n\n\n\n<p><strong>Explanation<\/strong>:<\/p>\n\n\n\n<p>\ue203The cash per share metric indicates how much of the company&#8217;s share price is backed by its cash and liquid assets. In this case, approximately $14 of Microsoft&#8217;s $117.67 share price is attributable to its cash holdings. This means that about 11.9% of the share price is represented by cash.\ue204\ue206<\/p>\n\n\n\n<p>\ue203It&#8217;s important to note that while cash holdings contribute to the company&#8217;s valuation, the share price also reflects other factors such as earnings potential, assets, liabilities, market conditions, and investor sentiment. Therefore, the remaining portion of the share price ($117.67 &#8211; $14 = $103.67) represents the market&#8217;s valuation of Microsoft&#8217;s non-cash assets and future growth prospects.\ue204\ue206<\/p>\n\n\n\n<p>\ue203In summary, while the exact cash per share is $14, the closest provided option is $11. This highlights the significance of Microsoft&#8217;s substantial cash reserves in its overall valuation, but also underscores that a significant portion of the share price is based on the company&#8217;s operational performance and future potential.\ue204<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Here is the capital structure of Microsoft. What part of the $117.67 share price (to the nearest dollar) is represented by cash? a. $21 b. $11 c. $17 The correct answer and explanation is: \ue203To determine the portion of Microsoft&#8217;s $117.67 share price represented by its cash holdings, we can follow these steps:\ue204 \ue203Given the [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"site-sidebar-layout":"default","site-content-layout":"","ast-site-content-layout":"default","site-content-style":"default","site-sidebar-style":"default","ast-global-header-display":"","ast-banner-title-visibility":"","ast-main-header-display":"","ast-hfb-above-header-display":"","ast-hfb-below-header-display":"","ast-hfb-mobile-header-display":"","site-post-title":"","ast-breadcrumbs-content":"","ast-featured-img":"","footer-sml-layout":"","ast-disable-related-posts":"","theme-transparent-header-meta":"","adv-header-id-meta":"","stick-header-meta":"","header-above-stick-meta":"","header-main-stick-meta":"","header-below-stick-meta":"","astra-migrate-meta-layouts":"default","ast-page-background-enabled":"default","ast-page-background-meta":{"desktop":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"ast-content-background-meta":{"desktop":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"tablet":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""},"mobile":{"background-color":"var(--ast-global-color-5)","background-image":"","background-repeat":"repeat","background-position":"center center","background-size":"auto","background-attachment":"scroll","background-type":"","background-media":"","overlay-type":"","overlay-color":"","overlay-opacity":"","overlay-gradient":""}},"footnotes":""},"categories":[25],"tags":[],"class_list":["post-184885","post","type-post","status-publish","format-standard","hentry","category-exams-certification"],"_links":{"self":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/184885","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/comments?post=184885"}],"version-history":[{"count":0,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/posts\/184885\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/media?parent=184885"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/categories?post=184885"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.learnexams.com\/blog\/wp-json\/wp\/v2\/tags?post=184885"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}