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EX3 You own 100 shares of common stock Company A. In total there are 1,000 shares...
how to solve this ? R&F Enterprises is an all equity firm with 70,000 shares of stock outstanding at a market price of $8 a share. The company has earnings before interest and taxes of $42,000...
how to solve this ?
R&F Enterprises is an all equity firm with 70,000 shares of stock outstanding at a market price of $8 a share. The company has earnings before interest and taxes of $42,000. R&F decides to issue $200,000 of debt at a 7 percent rate of interest. The $200,000 will be used to repurchase shares of the outstanding stock. Currently, you own 1,500 shares of R&F stock A) How many shares of this stock must you sell...
Company ABC has 10,000 shares outstanding and the stock price is $100. The company is expected...
Company ABC has 10,000 shares outstanding and the stock price is $100. The company is expected to pay a dividend of $10 per share next year and thereafter the dividend is expected to grow indefinitely by 6% a year. The company now makes an announcement: It will repurchase shares next year instead of issuing cash dividends. But from year 2 on the payout policy stays the same with cash dividends. 1. What is the expected rate of return on the...
Company ABC has 10,000 shares outstanding and the stock price is $100. The company is expected...
Company ABC has 10,000 shares outstanding and the stock price is $100. The company is expected to pay a dividend of $10 per share next year and thereafter the dividend is expected to grow indefinitely by 6% a year. The company now makes an announcement: It will repurchase shares next year instead of issuing cash dividends. But from year 2 on the payout policy stays the same with cash dividends. (Please check my work A - C, and solve for...
The Dunn Corporation is planning to pay dividends of $480000. There are 240000 shares outstanding, and...
The Dunn Corporation is planning to pay dividends of $480000. There are 240000 shares outstanding, and earnings per share are $5. The stock should sell for $50 after the ex-dividend date. If, instead of paying a dividend, the firm decides to repurchase stock, a. What should be the repurchase price? b. How many shares should be repurchased? c. What if the repurchase price is set below or above your suggested price in part (a)? d. If you own 100 shares,...
(Repurchase of stock) The Dunn Corporation is planning to pay dividends of $460000. There are 230000...
(Repurchase of stock) The Dunn Corporation is planning to pay dividends of $460000. There are 230000 shares outstanding, and earnings per share are $6. The stock should sell for $48 after the ex-dividend date. If, instead of paying a dividend, the firm decides to repurchase stock, a. What should be the repurchase price? b. How many shares should be repurchased? c. What if the repurchase price is set below or above your suggested price in part a? d. If you...
California surf clothing company issues 1,000 shares of $1 par value common stock at $27 per...
California surf clothing company issues 1,000 shares of $1 par value common stock at $27 per share. Later in the year, the company decides to repurchase 100 shares at a cost of $30 per share. Record the purchase of treasury stock. record the transaction if california surf reissues the 100 shares of treasury stock at $32 per share
Assume that you own 110 shares of common stock of a company, that you have been...
Assume that you own 110 shares of common stock of a company, that you have been receiving cash dividends of $6 per share per year, and that the company has a 5-for-4 stock split. Required: How many shares of common stock will you own after the stock split? What new cash dividend per share amount will result in the same total dividend income as you received before the stock split? (Do not round intermediate calculations. Round your answer to 2...
You own 1,000 shares of stock in Company K. You will receive a $2.50 per share...
You own 1,000 shares of stock in Company K. You will receive a $2.50 per share dividend in one year. In two years, Company K will pay a liquidating dividend of $55 per share. The required return on its stock is 12%. a) What is the current share price of your stock (ignoring taxes)? b) If you would rather have equal dividends in each of the next two years, show how you can accomplish this by creating homemade dividends.
RR Inc. has 5,000,000 shares of common stock outstanding, of which you own 125,000. Management decides...
RR Inc. has 5,000,000 shares of common stock outstanding, of which you own 125,000. Management decides to sell an additional 1,000,000 shares. The provision in the corporate charter that gives you the right to purchase your pro rata share of the new offering is known as a/an right. calling dilutive preemptive voting
Check my work Assume that you own 50 shares of common stock of a company, that...
Check my work Assume that you own 50 shares of common stock of a company, that you have been receiving cash dividends of $4 per share per year, and that the company has a 3-for-2 stock split. Required: a. How many shares of common stock will you own after the stock split? b. What new cash dividend per share amount will result in the same total dividend income as you received before the stock split? (Do not round intermediate calculations....
how to solve this ?
R&F Enterprises is an all equity firm with 70,000 shares of stock outstanding at a market price of $8 a share. The company has earnings before interest and taxes of $42,000. R&F decides to issue $200,000 of debt at a 7 percent rate of interest. The $200,000 will be used to repurchase shares of the outstanding stock. Currently, you own 1,500 shares of R&F stock A) How many shares of this stock must you sell...
You own 1,000 shares of stock in Company K. You will receive a $2.50 per share dividend in one year. In two years, Company K will pay a liquidating dividend of $55 per share. The required return on its stock is 12%. a) What is the current share price of your stock (ignoring taxes)? b) If you would rather have equal dividends in each of the next two years, show how you can accomplish this by creating homemade dividends.
RR Inc. has 5,000,000 shares of common stock outstanding, of which you own 125,000. Management decides to sell an additional 1,000,000 shares. The provision in the corporate charter that gives you the right to purchase your pro rata share of the new offering is known as a/an right. calling dilutive preemptive voting
Check my work Assume that you own 50 shares of common stock of a company, that you have been receiving cash dividends of $4 per share per year, and that the company has a 3-for-2 stock split. Required: a. How many shares of common stock will you own after the stock split? b. What new cash dividend per share amount will result in the same total dividend income as you received before the stock split? (Do not round intermediate calculations....
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