. CALCULATE the value of the firms when dividends are not paid

Q: profit of a firm if a debenture is issued at

A: A debenture is said to be issued at a premium  when the price charged is more than its nominal…

Q: is(are)the reason(s) for profit maximization not a reasonable goal for firms. a. Profit concept…

A: Profit Maximisation Concept aims at carrying out the business activities in such a way that the…

Q: Describe the primary reasons that a company’s book value in the balance sheet does not equal its…

A: Balance sheet: This is a financial statement that reports a company’s resources (assets) and claims…

Q: 3. (a). One of the reasons why firms pay dividends is that dividends payments can be a signal to the…

A: Dividend payment is essentially distribution of a part of earnings of a company with its…

Q: If the company equity ratio dropped what does that mean?

A: Equity Ratio: It represents the ratio of a firm's total equity to the total assets. The equity…

Q: If the generated income cash of  some company were used to buy back common stock,thus reducing the…

A: Return on equity means the profit as percentage on equity. Equity means the owner funds. Return on…

Q: How had dividend policy been used by firms as a “signal”. Why is it necessary for firms to send such…

A: Dividend is paid by the firm to the investors as a return. It can be paid in cash or stock. Dividend…

Q: How would you relate information asymmetry to firm’s dividend policy?

A: Information asymmetry refers to when one party has extensive knowledge about a particular subject…

Q: A. Why is the goal of financial management to maximize the current share price of the company's…

A: The answer for the question on the financial management is discussed hereunder : What is Financial…

Q: A firm can increase its earnings growth yet not affect the value of its equity. True OR False ???

A: Equity value is the value of a company available to owners or shareholders.

Q: Why would an analyst prepare a common-sized balance sheet?

A: Balance Sheet: It is one of the financial statements which shows the firm's liabilities, equity, and…

Q: What is the difference between dividends that are declared and dividends that are paid

A: There exist difference between dividend that is declared and paid

Q: What is the lowest dividend a firm could pay? What types of firms generally pay high dividends?…

A: Dividend is not compulsory to pay, when the company earns good profits , Board of directors…

Q: According to the bird-in-the-hand-theory, how do high dividends impact company value and why?

A: The dividend is the amount that is paid to the shareholders as the return on the shares after paying…

Q: Which of the following is a cost associated with an IPO? Interest expenses Out-of-pocket expenses…

A: Company means the form of business where management is separately from owner and have perpetual…

Q: Identify the term being referred to: A theory that states that how high or low an entity pays out…

A: Solution:- There are two theories related to dividend-  Dividend relevance theory and dividend…

Q: how does cost of capital affects a firm's decision on the distribution of dividends?

A: Cost of capital is defined as an required return, which is important for making the capital…

Q: )How would you relate information asymmetry to firm's dividend policy?

A: Information asymmetry means when one party has more information than other party. For example, in a…

Q: Which of the following is one of the causes of over capitalization? a. Reduction in the market…

A: Over Capitalization means when a company have huge amount of debt in its book and its Net assists…

Q: Why can't the full retained earnings balance be used to pay a dividend A B C D Because the firm must…

A: Dividend is the amount of earnings of the company which is distributed to its shareholder's for…

Q: dividend amount of a firm, unexpectedly falls, what will shareholders do

A: Dividend is the amount of earnings of a firm distributed to shareholders.

Q: What is Revaluation Reserve? A. Any cost that has not yet been charged to the expense B. The amount…

A: Revaluation reserve is a non-cash reserve created to reflect the true value of the asset when the…

Q: Explain what happens to the firm’s cost of equity, cost of debt, and cost of capital when the firm…

A: Modigliani and Miller's approach (M&M) states that the valuation of a firm is independent of the…

Q: If you want to value a firm that consistently pays out its earnings as dividends, the simplest model…

A: Valuing companies: There are several methods that are used to value a company. Four of the most…

Q: What are the best two measures for the profitability of firms that are not publicly traded?

A: Profitability, rate of return, as well as the pre-tax income are all metrics that would be used to…

Q: hat does it mean when a company has zero net income but its stock price has increased? How do you…

A: Equity method: The equity method is used to record the profit earned by a company by investing in…

Q: Select all of the following that will have a negative effect on the firm" flows? (Assume other…

A: When expenditures exceed income, a negative cash flow arises, potentially leading to financial…

Q: Which of the following statement on the firm's net working capital is incorrect? A. Holding other…

A: Formula for net working capital is current assets - Current liabilities.

Q: Explain how repurchases can (1) help stockholders limit taxes and (2) help firmschange their capital…

A: Repurchase of stock is also known as buyback. Buyback means buying the shares by the company. By…

Q: Explain the two primary reasons that a company’s book value in the balance sheet does not equal its…

A: Balance sheet: This financial statement reports a company’s resources (assets) and claims of…

Q: With regard to the Earnings per Share (EPS), what kinds of actions can the firm take to increase the…

A: The question is based on the concept of Earnings per Share (EPS) and its improvement. EPS is…

Q: Why does the equity method record dividends from an investee as a reduction in the investment…

A: The carrying amount or the book value of the investment is reduced in order to record the dividend…

Q: One of the reasons why firms pay dividends is that dividends payments can be a signal to  the…

A: Dividend payments can be an indication that the firm is going to do well in the future. Firms that…