Question

At the quarterly dividend​ meeting, Wood Shoes declared a cash dividend of ​$1.441.44

per share for holders of record on​ Monday, July 10. The firm has $250,000

shares of common stock outstanding and has set a payment date of July 31. Prior to the dividend​ declaration, the​ firm's key accounts were as​ follows:

Cash	​$500,000	Dividends payable	​$ 0
		Retained earnings	$2,400,000

a.  Show the entries after the meeting adjourned.

b.  When is the ​ex-dividend ​date?

c.  What values would the key accounts have after the July 31 payment​ date?

d.  What​ effect, if​ any, will the dividend have on the​ firm's total​ assets?

e.  Ignoring general market​ fluctuations, what​ effect, if​ any, will the dividend have on the​ firm's stock price on the​ ex-dividend date?

Answer 1