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Question
According to the residual theory of dividends:A) dividends are to be paid out only after investment financing needs have been met.
B) earnings remaining after payment of preferred stock dividends should be paid to common stockholders.
C) dividend payments are a constant percentage of EPS.
D) a dividend is the residual above the payout ratio.
Answer
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Related questions
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A) The net present value.
B) The internal rate of return.
C) The profitability index.
D) The modified internal rate of return.
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The equivalent annual cost method is most appropriate in which of the following situations? In each case, assume that several mutually exclusive options are available.
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The size of capital investments and the difficulty in reversing them once they are made make capital-budgeting decisions very important to the firm.
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Competitive market forces make it imperative for a firm to have a systematic strategy for generating capital-budgeting projects.
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Good capital investment opportunities are most likely to exist when:
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Q:
If the ROE on a new investment is less than the firm's required rate of return:
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B) 14.
C) 2.14.
D) 30.
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Draper Company's common stock paid a dividend last year of $3.70. You believe that the long-term growth in the dividends of the firm will be 8% per year. If your required return for Draper is 14%, how much are you willing to pay for the stock?
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A stock dividend increases a firm's retained earnings.
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By virtue of its nature, dividend policy is inherently a wealth-creating activity for the firm's owners.
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Dividend payout ratios are generally much lower for small or newly established firms than for large, publicly owned firms.
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The dividend declaration date is the date at which the stock transfer books are to be closed for determining the investor to receive the next dividend payment.
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The ________ designates the date on which the stock transfer books are closed in regard to a dividend payment.
A) declaration date
B) ex-dividend date
C) date of record
D) payment date
Q:
Five years ago, Mr. Martinez purchased 1000 shares of JPM stock at $50 per share. If Mr. Martinez ' tax rate is 25% would he prefer that the company pay a $5.00 per share dividend or offer to repurchase 100 shares at $50 per share?
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For accounting purposes, a stock split has been defined as a stock dividend exceeding:
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A stock dividend will cause changes in the dollar value of which of the below capital accounts?
A) Common stock
B) Additional paid-in capital
C) Retained earnings
D) All of the above
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A) There is not enough information to know.
B) EPS will increase by 10%.
C) EPS will not be affected by the stock dividend.
D) EPS will decrease by 10%.