Ashkenazi Companies has the following stockholders' equity account:Common stock (425,901 shares at $3 par)Paid-in capital in excess of parRetained earningsTotal stockholders' equity$1,277,7033,383,532938,765$5,600,000Assuming that state laws define legal capital solely as the par value of common stock, how much of a per-share dividend can Ashkenazi pay? If legal capital were more broadly defined to includeall paid-in capital, how much of a per-share dividend can Ashkenazi pay?Assuming that state laws define legal capital solely as the par value of common stock, the per-share dividend Ashkenazi can pay is $(Round to the nearest cent.)

Given:Common stock = $1,277,703Paid in capital in excess of par = $3,383,532Retained Earnings =…

Answered: Ashkenazi Companies has the following…

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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1. Warephase Corporation has preferred stock outstanding. The stock has a 16% dividend rate. The stock's market price is $80 per share, and its par value is $75. If new shares are issued, the firm will pay $3.50 per share in flotation costs. The corporate tax rate is 21%. What is the company's cost of preferred stock financing? O 12.40% O 16.73% O 13.46% 9.12% 15.69%
(show manual working if possible, for me to understand. thank you.)
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Charleston Mills is an all-equity firm with a total market value of $221,000. The firm has 8,000 shares of stock outstanding. Management is considering issuing $50,000 of debt at an interest rate of 7 percent and using the proceeds on a stock repurchase. Ignore taxes. How many shares can the firm repurchase if the is issues the debt securities? A- 1,810 shares B- 1,818 shares C- 1,847 shares D- 1,856 shares E-1,899 shares
The owners' equity accounts for Mars International are shown here: Common stock ($.50 par value) Capital surplus Retained earnings Total owner's equity Please show the equity accounts will change if: a. The company declares a 5-for-1 stock split. How many shares are outstanding now? What is the new par value per share? b. The company declares a 1-for-4 reverse stock split. $20,000 210,000 587,300 $817,300 c. The balance sheet for Mars International is shown below in Market value terms. There are 12,000 shares of stock outstanding. Market Value Balance Sheet Equity $817,300 Cash $ 99,660 Fixed assets 717,640 Total $817,300 Total $817,300 The company has declared a dividend of $1.45 per share. The stock goes ex dividend tomorrow. Ignoring any tax effects, what is the stock selling for today? What will it sell for tomorrow? What will the balance sheet look like after the dividends are paid? d. suppose the company has announced it is going to repurchase $17,400 worth of stock. What effect…
You are considering investing in ABC, Inc. The current price of ABC, Inc. is $62 a share, the after-tax earnings are $37,900,000, and there are 13,000,000 outstanding shares of common stock. What is ABC, Inc.'s price/earnings ratio? 15.5 21.3 47 17.6 4.8
In its capital structure, ABC Corporation has preferred stock paying a dividend of P5 per share and selling for P23. The company’s tax rate is 40 percent. Calculate (a) the before-tax cost preferred stock, and (b) the after-tax cost of preferred stock.? CHOOSE THE CORRECT LETTER OF ANSWERA. (a)31.7 and (b)21.7%B. (a)11.7 and (b)15.7%C. (a)21.7 and (b)11.7%D. (a)21.7 and (b)21.7%E. None of the above
B. Z Corporation has 1,000 shares of K20 par value common stock outstanding. The company is considering a 4 for 1 stock split. How will this affect the shareholders' equity accounts?
Your corporation currently has 200,000 shares of stock outstanding that sells for $50.00 per share. What will be the amount of shares outstanding and the share price after the reverse stock split. Please show your calculations in the space provided.Your corporation declared a three-for-six reverse stock split.
Sixth Fourth Bank has an issue of preferred stock with a $6.80 stated dividend that just sold for $88 per share. What is the bank’s cost of preferred stock?
The expected pretax return on three stocks is divided between dividends and capital gains in the following way: Stock Expected Dividend Expected Capital Gain A $0 $10 B 5 5 C 10 0 Required: a. If each stock is priced at $110, what are the expected net percentage returns on each stock to (i) a pension fund that does not pay taxes, (ii) a corporation paying tax at 21% (the effective tax rate on dividends received by corporations is 6.3%), and (iii) an individual with an effective tax rate of 15% on dividends and 10% on capital gains? b. Suppose that investors pay 50% tax on dividends and 20% tax on capital gains. If stocks are priced to yield an after-tax return of 8%, what would A, B, and C each sell for? Assume the expected dividend is a level perpetuity. Req A Req B If each stock is priced at $110, what are the expected net percentage returns on each stock to (i) a pension fund that does not pay taxes, (ii) a corporation paying tax at 21% (the effective…

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