What are the company motives for declaring dividends or stock repurchase programs? 2. How would you argue for a significant increase in both dividends and repurchases instead of using the available cash to make investments, i.e. M&A? 3. Would the tax treatment of dividend income versus capital gains income affect the managers’ decisions to disburse cash via dividends versus stock repurchases?

Q: Which of the following statements is CORRECT? O The more depreciation a firm reports, the higher its…

A: Depreciation means reduction in value of fixed assets over the period of time. It is for normal wear…

Q: 5. Which of the following is NOT a true statement about the goal of maximizing shareholders' wealth?…

A: You have posted multiple questions. We will solve the only first question for you. The shareholders…

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: Which of the following do/does NOT describe how shareholders accrue investment returns (Select all…

A: We make investments in different types of financial assets like stocks, bonds, etc. Here the…

Q: Why might the riskiness of cash flow from the residual value of the real estate differ from the…

A: It is nothing but the salvage value or scrap value of an asset. It speaks to the measure of…

Q: Would it ever be rational for a firm to borrow money in order to pay cash dividends? Explain.

A: The dividends can be paid by company on following  these rules: 1. Out of profits of the company…

Q: To what extent do you feel the company’s dividend policies support or hinder their strategies? For…

A: The main aim of any organization should be to increase shareholder value, however for any growth…

Q: What do an appropriation of accumulated profits and a declaration of a cash dividend have in common?…

A: Cash dividends are accounted for as a reduction of retained earnings(Accumulated profits)…

Q: What rate do investors use to discount the capital gains and cash flows of firms?

A: Discounted cash flow estimates the present value of an asset by using projected cash flows.…

Q: Which of the following does NOT set the upper limit on the amount of cash dividend that a company…

A: The correct answer is none of them - all of these factors can limit the amount of cash dividend a…

Q: Dividend policy determines the ratio between the earnings distributed to shareholders and the…

A: Dividend policy is referred as the dividend distribution, which has the guidelines that actually…

Q: Which of the following is not one of the primary considerations management must make before a cash…

A: Answer: Primary considerations are those which directly impact any decisions made for the company.…

Q: Which of the following theories is supported by the argument that shareholders can transform a…

A: The correct answer is:b. "bird-in-the-hand" theoryExplanation:The "bird-in-the-hand" theory,…

Q: Which of the following statements is not correct? Group of answer choices A)Purchasing fixed assets…

A: A)Purchasing fixed assets using cash decreases the current ratio. Purchasing fixed asset using cash…

Q: Does the offer of receiving cash dividend and stock repurchase make any differences to an individual…

A: There are 2 concepts asked in the questions: - 1. Dividend on stock: In a general company, a…

Q: Which of the following statements is not true? a) The return on shareholders’ funds can be…

A:

Q: What does a positive operating cash flow mean for a company? What do a positive cash flow from…

A: Operating cash flow is a measure of the cash generated or consumed by a company's normal business…

Q: The most important factor to consider when determining the dividends to be declared is a. the…

A: When a company has more cash than it can use(Profit in hand and no further expansion plan to grow),…

Q: From the firm’s perspective, how are dividends different from interest payments?

A: Even though interest and dividend are two distinct ideas, both are critical components of a…

Q: Did the cash flow from operations cover the dividend payment made by the firm (if any)?

A: Hello, since your question has multiple parts we will solve the first question for you. If you want…

Q: To what extent does the company’s dividend policies support or hinder their strategies? For example,…

A: Dividend Policy:A company makes a structure of dividend payout and that structure is known as…

Q: Which of the following statements is FALSE? i. Using the payback rule, you can calculate how much…

A: Payback period is the time taken by the project to cover its initial investment. It is the time to…

Q: Which of the following is a drawback of payback period method of investment appraisal? O it is cash…

A: Pay-back period:- It is the length of time required to recover the cost of the cash outflow. It is…

Q: Suppose managers of a firm know that the company is approaching financial distress. Should the…

A: Financial distress The situation in which the company is not able to meet its obligation to…