Intermediate Financial Management (MindTap Course List)
Intermediate Financial Management (MindTap Course List)
12th Edition
ISBN: 9781285850030
Author: Eugene F. Brigham, Phillip R. Daves
Publisher: Cengage Learning
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Chapter 6, Problem 3Q

If a “typical” firm reports $20 million of retained earnings on its balance sheet, can the firm definitely pay a $20 million cash dividend?

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If a “typical” firm reports $20 million of retained earnings on its balancesheet, can the firm definitely pay a $20 million cash dividend?
Suppose a firm is paying dividend of $500000 out of net income of $2 million. What is the firm's payout ratio?
A firm has a market value equal to its book value. Currently, the firm has $500,000 of excess cash, $4,500,000 in other assets, $1,000,000 in liabilities, $40,000 in common stock at $1 par, $0 in retained earnings, and $30,000 in net income. Assume that the firm uses all of its excess cash to repurchase some of its shares outstanding. How many shares will be outstanding after the repurchases are completed? (Round, if necessary, your final answer to the whole number).
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