Question

Fauver Enterprises declared a 5-for-1 stock split last year, and this year its dividend is $0.80...

Fauver Enterprises declared a 5-for-1 stock split last year, and this year its dividend is $0.80 per share. This total dividend payout represents a 14% increase over last year's pre-split total dividend payout. What was last year's dividend per share? Round your answer to the nearest cent.

$  

Homework Answers

Answer #1
Ans. Last year's dividend per share   =   $3.51
Dividend per share after split = 0.80
Equivalent pre-split dividend =   5 * 0.80
   4
Equipent pre-split dividend = last year's dividend * (1 + increased total dividend payout)
   4 = last year's dividend * (1 + 14%)
Last year's dividend = 4 / 1.14
3.51
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