In the real world we find that dividends a) are uaually more stable than earnings b) fluctuate more widely than earnings c) tend to be a lower percentage of earnings for mature firms d) Are usually changed every year to reflect earnongs changes, and these changes are randomly higher or lower, depending on whether earnings
You currently own 100 shares of Toll Brothers stock which currently sells for $120 a share. The company is contemplating a 2-for-1 stock split. Which of the following best describles what your position will be after such a split takes place? a) You will have 200 shares of stock and it will trade at or near $120/share. b) Y
Complete the readings for this unit, including Case 1.2 titled "Nike: Somewhere Between a Swoosh and a Slam Dunk." Study the financial statements and notes provided. I need help to respond to the lettered series of questions at the end of the case. Then, write a 300- to 400-word essay explaining your position. Make sure your
Keane Tech has a capital budget of $1,100,000, bbut it wants to amintain a target capital structure of 50% equity and 50% debt. The company expects to pay a dividned of $250,000. If the company follows a residual dividend policy, what is its forecasted net income? $700,000 $800,000 $900,000 $1,100,000
Please provide your analysis on the attached problems. Please note that other students in my group have made references to post 204910 and 237047 in the brainmass library. Please include citation.
Cash $25,000 Fixed Assets $190,000 --------------------------- Total $215,000 Equity $215,000 5,000 shares of stock outstanding with a declared dividend of $1.20 per share. What if the company whats to repurchase $6,000 worth of stock? What effect will this transaction have on the equity of the company? How m
An insurance company purchased bonds issued by Hartnett Company two years ago. Today, Cookeres Company has begun to issue junk bonds and is using the funds to repurchase most of its existing stock. Why might the market value of those bonds held by the insurance company be affected by this action?
A firm has 20 million common shares outstanding. It currently pays out $1.50 per share per year in cash dividends on its common stock. Historically, its payout ratio has ranged from 30% to 35%. Over the next five years it expects the earnings and discretionary cash flow shown in millions. a. Over the five-year period, what
A firm has 20 million common shares outstanding. It currently pays out $1.50 per share per year in cash dividends on its common stock. Historically, its payout ratio has ranged from 30% to 35%. Over the next five years it expects the earnings and discretionary cash flow shown below in millions. a. Over the five-year period, w
I need help with these questions. Thanks. 1. Which of the following statements is likely to encourage a firm to increase its debt ratio in its capital structure? a. Its sales become less stable over time. b. Its corporate tax rate declines. c. Management believes that the firm's stock is overvalued. d. Its sales become
On January 1, Armada Corporation had 95,000 shares of no-par common stock issued and outstanding.The stock has a stated value of $5 per share. During the year, the following occurred. Apr. 1 Issued 15,000 additional shares of common stock for $17 per share. June 15 Declared a cash dividend of $1 per share to stoc
Dear Brainmass, I am having some difficulty in understanding how to prepare the journal entries for these independent transactions. I would really appreciate the assistance when you get the chance. Thank you so much in advance for taking the time to review my post. Prepare Journal Entries for the following independent tr
Solar, Inc. has financial leverage of 34.0% and a net after-tax borrowing cost of 5% on $171.70 million of net debt. Its return on common equity (ROCE) is 25.1%. a. What rate of return does this firm earn on its operations? b. Solar, Inc. is considering repurchasing $125 million of its stock and financing the repurchase w
1. Dryer Company had 300,000 shares of common stock issued and outstanding at December 31, 2003. During 2004, no additional common stock was issued. On January 1, 2004, Dryer issued 400,000 shares of nonconvertible preferred stock. During 2004, Dryer declared and paid $240,000 cash dividends on the com
Delta Corporation earned $2.50 per share during fiscal year 2008 and paid cash dividends of $1.00 per share. During the fiscal year that just ended on December 31, 2009, Delta earned $3.00 per share, and the firm's managers expect to earn this amount per share during fiscal years 2010 and 2011, as well. a. What is Delta's pa
Prepare a response in which you answer: What is the purpose of the statement of cash flows? What information does it provide? Be sure to explain why statements of cash flows are important when assessing the financial strength of an organization.
7. Your corporation has the following stockholders equity. Common Stock at par $ 750,000 Paid in capital in excess of par 1,250,000 Retained earnings 2,500,000 Total $ 4,500,000 a. What is the maximum amount of dividends the c
Beta Industries has a net income of $2,000,000 and it has $1,000,000 shares of common stock outstanding. The company's stock currently trades @$32 a share. Beta is considering a plan in which it will use available cash to repurchase 20% of its shares in the open market. The repurchase is expected to have no effect on either net
Describe the general relationship between net income and net cash flows from operating activities for the firm. Has the buildup in plant and equipment been financed in a satisfactory manner? Briefly discuss. PG 51-53 Questions 28 & 29
Prepare a financial statements analysis using the financial statements of Landry's Restaurants located in Appendix A of the text, Fundamentals of Financial Accounting 1st ed., by Phillips, Libby, and Libby, compute the following ratios for 2002 and 2003 to the following assignments from the e-text, Fundamentals of Financial Acco
3. What relationship do you see between a company's board of directors and the development of the business strategy? 4. Do you believe that a company's board of directors can change the ethical standards in a business? How can they do it?
1750-2000 words, excluding title and references Details: As SACs corporate business financial analyst, you will be required to provide the SAC Board of Directors and executive management team with essential financial information on the management of the SAC enterprise. What are the basic financial statements you will submit to
A firm has $120,000 in stockholders' equity. Earnings for the year are $20,000 and are included in retained earnings. Forty thousand dollars is listed as common stock and the balance is in retained earnings. The firm has $250,000 in total assets and 3 percent of this value is in cash. 1. Figure legal limit on current dividend
3. As a financial manager for Old's California, you have the following information: a) The company follows a residual dividend policy; b) The total capital budget for next year is likely to be $5 million; c) The forecasted level of potential retained earnings next year is $8million; d) The target or optimal capital struc
If the market capitalization rate for each stock is 10 percent, which stock is the most valuable? What if the capitalization rate is 7 percent?
Consider the following three stocks: a. Stock A is expected to provide a dividend of $10 a share forever. b. Stock B is expected to pay a dividend of $5 next year. Thereafter, dividend growth is expected to be 4 percent a year forever. c. Stock C is expected to pay a dividend of $5 next year. Thereafter, dividend growth is
Tapley Inc. currently has assets of $5 million, zero debt, is in the 40% federal-plus-state tax bracket, has a net income of $1 million, and pays out 40% of its earnings as dividends.
Tapley Inc. currently has assets of $5 million, zero debt, is in the 40% federal-plus-state tax bracket, has a net income of $1 million, and pays out 40% of its earnings as dividends. Net income is expected to grow at a constant rate of 5 percent per year, 200,000 shares of stock are outstanding, and the current WACC is 13.40%.
Greenwood Corporation has paid 60 consecutive quarterly cash dividends (15 years). The last 6 months have been a real cash drain on the company, however, as profit margins have been greatly narrowed by increasing competition. With a cash balance sufficient to meet only day-to-day operating needs, the president, Gil Mailor, has
P3-14 Pro forma balance sheet Peabody & Peabody has 2006 sales of $10 million. It wishes to analyze expected performance and financing needs for 2008-2 years ahead. Given the following information, respond to parts a and b. (1) The percents of sales for items that vary directly with sales are as follows: Accounts receivable
Explain or discuss with your own words of the following concept: 1. Capital Structure
Pick one item below and discuss and/or explain with your own words what it is and how it applies to Microsoft. 1. Dividend policy 2. Stock buyback 3. Financial leverage 4. Earnings per share