Final answer:
The question pertains to business finance, focusing on the acquisition cost of a company's shares. The provided examples illustrate how stock transactions and company valuations can be analyzed, using share purchases and predictions of future profits to understand the costs of acquisitions.
Step-by-step explanation:
The subject of your question is related to business finance, specifically to the acquisition of a company and the determination of its cost. On January 1, 2024, when Presidio Company acquired 100 percent of the outstanding common stock of Mason Company, the cost they paid is not directly specified in the question. However, if we use the given examples and the context of company acquisitions, we can analyze similar transactions to understand the costs involved. Here are some examples provided:
- Investors purchase shares of stock from companies such as Nike, Panda Express, and Wal Mart, and sell them when the market price rises to realize a net profit, taking into account the transaction fees.
- Babble, Inc. is an example of a company's valuation where profits are expected and dividends are paid out. An investor will consider the present value of future profits, discounted at a specific rate, to determine what they would pay for a share of stock.
Looking at the Babble, Inc. case, given the expected profits and the present value calculated with a 15% interest rate, an investor would pay about $256,500 per share of stock for the company's 200 shares. This information, while not providing the exact amount Presidio paid for Mason Company, helps us understand the type of calculations and considerations involved in such transactions.