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The Determination of a Company's Stock Price

Balance sheet for Levy Corp. is below in Market Value Terms. There are 6,000 shares of stock outstanding.
Cash 19,000 Equity 182,000
Fixed Assets 163,000

Total 182,000 Total 182,000

Company has declared a dividend of $1.20 per share. Stock goes ex-dividend tomorrow. Ignoring tax effects, what is stock selling for today? What is it selling for tomorrow? What will the balance sheet look like after dividends are paid?

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Solution Summary

This solution provides a balance sheet for Levy Corp.

$2.19