Regular dividends are A) taxed at the same rate as capital gains B) taxed at a...
Regular dividends are
A)
taxed at the same rate as capital gains
B)
taxed at a lower rate than capital gains
C)
a dividend paid only when assets are sold
D) a dividend that the firm expects to continue paying in all future periods
Homework Answers
Regular dividends are:
D) a dividend that the firm expects to continue paying in all future periods
Add Answer to:
Regular dividends are
A)
taxed at the same rate as capital gains
B)
taxed at a...
O Automatically taxed at a lower capital gains tax rate. Treated as normal dividends and taxable...
O Automatically taxed at a lower capital gains tax rate. Treated as normal dividends and taxable in the year received. O Not taxable until the fund is sold. O Not taxable until they are withdrawn from the fund. Mark for follow up Question 23 of 75. For individuals in the 10% and 15% brackets in 2018, the income from qualified dividends will be t 0 0%. O 5% O 8%. O 10%. Mark for follow up Question 24 of 75....
8. If dividends are taxed more heavily than capital gains, investors: a) Should pay more for...
8. If dividends are taxed more heavily than capital gains, investors: a) Should pay more for stocks with low dividend yields b) Should pay more for stocks with high dividend yields c) Should pay the same for stocks regardless of the dividend yields d) Cannot be predicted as stock prices fluctuate randomly 9. Firm Alpha has a value of £300 million and Firm Beta has a value of £200 million. Merging the two companies would allow cost savings with a...
Suppose that all capital gains are taxed at a 18% rate, and that the dividend tax...
Suppose that all capital gains are taxed at a 18% rate, and that the dividend tax rate is 36%. Arbuckle Corp. is currently trading for $41, and is about to pay a $6 special dividend a. Absent any other trading frictions or news, what will its share price be just after the dividend is paid? Suppose Arbuckle made a surprise announcement that it would do a share repurchase rather than pay a special dividend. b. What net tax savings per...
Air Taxi, Inc. has declared a $9.50 per-share dividend. Suppose capital gains are not taxed, but...
Air Taxi, Inc. has declared a $9.50 per-share dividend. Suppose capital gains are not taxed, but dividends are taxed at 15% and new regulations require that dividends are taxed when paid. Air Taxi stock sells for $115 per share. What will the ex-dividend price be? Dividend per share $9.50 Tax rate 15% Price $115.00
For B) the answer I got is $16,595 from $17,250-$457.88-$197.10 I taxed the capital gains at...
For B) the answer I got is $16,595 from
$17,250-$457.88-$197.10
I taxed the capital gains at 20.35%, the dividends are grossed
up by 38% with eligible dividend tax at 21.64%. Not sure if my
answer is correct though. Use the 2017 rates. All help is
appreciated for b) and c).
: Donna works in BC as a security analyst. Her salary for 2017 was $130,000. In 2014, she bought 1500 shares of a large public company at $10/share on which...
Myron Gordon and John Lintner believe that the required return on equity increases as the dividend payout ratio is lowered. Their argument is that
Myron Gordon and John Lintner believe that the required return on equity increases as the dividend payout ratio is lowered. Their argument is that A. investors are indifferent between dividends and capital gains B. investors view dividends as being less risky than potential future capital gains C. investors require that the dividend yield plus the capital gains yield equal a constant D. investors prefer a dollar of expected capital gains to a dollar of expected dividends because of the lower tax rate on capital...
The expected pretax return on three stocks is divided between dividends and capital gains in the...
The expected pretax return on three stocks is divided between dividends and capital gains in the following way! Expected Expected Stock Dividend Capital Gain $10 50 Required: o. If each stock is priced at $195, what are the expected net percentage returns on each stock too) a pension fund that does not pay taxes, a corporation paying tax at 21% (the effective tax rate on dividends received by corporations is 6.3%), and (ii) an individual with an effective tax rate...
Capital Gains and Losses. (Obj. 2) For each of the following cases, determine would be taxed...
Capital Gains and Losses. (Obj. 2) For each of the following cases, determine would be taxed as short-term capital gain, long-term capital gain taxed capital gain taxed at 15%, or long-term capital gain taxed at 0%. Assum as single and this is the only capital asset sold during the year. determine whether the gain ved at 20%, long-term %. Assume the taxpayer files a. Stock held for four years is sold for a $3,000 gain; taxable income is $25.000 b....
Please answer all parts. thank you! Low-regular-and-extra dividend policy Bennett Farm Equipment Sales, Inc. is in...
Please answer all parts. thank you!
Low-regular-and-extra dividend policy Bennett Farm Equipment Sales, Inc. is in a highly cyclical business. Although the firm has a target payout ratio of 25 %, its board realizes that strict adherence to that ratio would result in a fuctuating dividend and create uncertainty for the firm's stockholders. Therefore, the firm has declared a regular dividend of $0.60 per share per year with extra cash dividends to be paid when earnings justify them. Earnings per...
Which one of these statements is correct? Dividends are more tax-advantaged than capital gains. In the...
Which one of these statements is correct? Dividends are more tax-advantaged than capital gains. In the U.S. economy, dividends are quite insignificant. The tax law change in May 2003 is cited as one reason why the percentage of dividend payers has decreased in the U.S. Over the last few decades, the percentage of U.S. firms paying dividends has increased. Much of the dividend income paid in the U.S. is related to a small number of firms.
O Automatically taxed at a lower capital gains tax rate. Treated as normal dividends and taxable in the year received. O Not taxable until the fund is sold. O Not taxable until they are withdrawn from the fund. Mark for follow up Question 23 of 75. For individuals in the 10% and 15% brackets in 2018, the income from qualified dividends will be t 0 0%. O 5% O 8%. O 10%. Mark for follow up Question 24 of 75....
8. If dividends are taxed more heavily than capital gains, investors: a) Should pay more for stocks with low dividend yields b) Should pay more for stocks with high dividend yields c) Should pay the same for stocks regardless of the dividend yields d) Cannot be predicted as stock prices fluctuate randomly 9. Firm Alpha has a value of £300 million and Firm Beta has a value of £200 million. Merging the two companies would allow cost savings with a...
Suppose that all capital gains are taxed at a 18% rate, and that the dividend tax rate is 36%. Arbuckle Corp. is currently trading for $41, and is about to pay a $6 special dividend a. Absent any other trading frictions or news, what will its share price be just after the dividend is paid? Suppose Arbuckle made a surprise announcement that it would do a share repurchase rather than pay a special dividend. b. What net tax savings per...
For B) the answer I got is $16,595 from
$17,250-$457.88-$197.10
I taxed the capital gains at 20.35%, the dividends are grossed
up by 38% with eligible dividend tax at 21.64%. Not sure if my
answer is correct though. Use the 2017 rates. All help is
appreciated for b) and c).
: Donna works in BC as a security analyst. Her salary for 2017 was $130,000. In 2014, she bought 1500 shares of a large public company at $10/share on which...
The expected pretax return on three stocks is divided between dividends and capital gains in the following way! Expected Expected Stock Dividend Capital Gain $10 50 Required: o. If each stock is priced at $195, what are the expected net percentage returns on each stock too) a pension fund that does not pay taxes, a corporation paying tax at 21% (the effective tax rate on dividends received by corporations is 6.3%), and (ii) an individual with an effective tax rate...
Capital Gains and Losses. (Obj. 2) For each of the following cases, determine would be taxed as short-term capital gain, long-term capital gain taxed capital gain taxed at 15%, or long-term capital gain taxed at 0%. Assum as single and this is the only capital asset sold during the year. determine whether the gain ved at 20%, long-term %. Assume the taxpayer files a. Stock held for four years is sold for a $3,000 gain; taxable income is $25.000 b....
Please answer all parts. thank you!
Low-regular-and-extra dividend policy Bennett Farm Equipment Sales, Inc. is in a highly cyclical business. Although the firm has a target payout ratio of 25 %, its board realizes that strict adherence to that ratio would result in a fuctuating dividend and create uncertainty for the firm's stockholders. Therefore, the firm has declared a regular dividend of $0.60 per share per year with extra cash dividends to be paid when earnings justify them. Earnings per...
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