Question

1. Chief Executive Officer Dr. Gamecock would like us to calculate a Stable Target Dividend payout...

1. Chief Executive Officer Dr. Gamecock would like us to calculate a Stable Target Dividend payout of 50% of Profit After Tax for the company. There are 10 million shares of common stock outstanding with Profit After Tax over the last five years as follows:

Year One: $30 million

Year Two: $40 million

Year Three: $45 million

Year Four: $60 million

Year Five: $45 million

What should the amount of the Stable Target Dividend be?

Business   Finance   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
A firm’s total annual dividend payout is $1 million. Its stock price is $45 per share...
A firm’s total annual dividend payout is $1 million. Its stock price is $45 per share and it has 17,500,000 shares outstanding. The firm earned $4 million in Net Income last year. This year, the firm expects earnings to grow at 7%, with growth the year after that expected to be 5%, and then in all following years, the firm expects earnings to grow at 3%. The firm plans to hold their dividend payout ratio constant over the coming 20...
The Chief financial officer of Kurdishy Oil has given you the assignment of estimating the firm’s...
The Chief financial officer of Kurdishy Oil has given you the assignment of estimating the firm’s cost of capital. The present capital structure, which is considered optimal, is as follows: Market Value Debt $40 million Preferred stock 5 million Common equity 55 million The anticipated financing opportunities are: 1) Debt can be issued with a 15 percent before-tax cost. 2) Preferred stock will be $100 par, carry a dividend of 13 percent, and can be sold at $96 per share....
1.In terms of changes in the number of shares outstanding, a 20% stock dividend is equivalent...
1.In terms of changes in the number of shares outstanding, a 20% stock dividend is equivalent to a ____________ stock split. Select one: a. six for five b. six for four c. five for three d. five for four e. seven for six 2. PQR Inc. has a debt-equity ratio of 1.6 and 1 million shares outstanding. The firm’s pro-forma Statement of Comprehensive income for the next year indicates that its net income will be $560,000. If the company proposes...
YEAR PROFITS AFTER TAXES 1 ​$17,000,000 2   20,000,000 3   18,000,000 4   22,000,000 5   24,000,000 Dividend policies​)...
YEAR PROFITS AFTER TAXES 1 ​$17,000,000 2   20,000,000 3   18,000,000 4   22,000,000 5   24,000,000 Dividend policies​) Final earnings estimates for Chilean Health Spa​ & Fitness Center have been prepared for the CFO of the company and are shown in the following​ table: . The firm has 7,600,000 shares of common stock outstanding. As assistant to the​ CFO, you are asked to determine the yearly dividend per share to be paid depending on the following possible​ policies:a. A stable dollar dividend...
ch.14 :Brooks Sporting Inc. is prepared to report the following 2016 income statement (shown in thousands...
ch.14 :Brooks Sporting Inc. is prepared to report the following 2016 income statement (shown in thousands of dollars). Sales $16300 Operating costs including depreciation 11410 EBIT $4890 Interest 330 EBT $4560 Taxes (40%) 1824 Net income $2736 Prior to reporting this income statement, the company wants to determine its annual dividend. The company has 430000 shares of stock outstanding, and its common stock trades at $52 per share. The data has been collected in the Microsoft Excel Online file below....
Mike Trout is an analyst in the research department of an international securities firm. Mike is...
Mike Trout is an analyst in the research department of an international securities firm. Mike is currently analyzing Hildy Products, a publicly traded global consumer goods company located in the United States. Selected data for Hildy are presented in Exhibit 1 EXHIBIT 1 SELECTED FINANCIAL DATA FOR HILDY PRODUCTS Most Recent Fiscal Year: Pretax income- $280 million Net Income after tax -$182 million Cash flow from operations- $235 million Capital expenditures- $175 million Earnings per share- $1.82 Current: Shares outstanding-...
7. David Ortiz Motors has a target capital structure of 20% debt and 80% equity. The...
7. David Ortiz Motors has a target capital structure of 20% debt and 80% equity. The yield to maturity on the company’s outstanding bonds is 5.7%, and the company’s tax rate is 23%. Ortiz’s CFO has calculated the company’s WACC as 10.45%. What is the company’s cost of equity capital? 8. On January 1, the total market value of the Tysseland Company was $60 million. During the year, the company plans to raise and invest $30 million in new projects....
Show all work and explain your answers clearly 1. You have been given the following projections...
Show all work and explain your answers clearly 1. You have been given the following projections (expectations) for Cali Corporation for the coming year: ? Sales = 10,000 units ? Sales price per unit = $10 ? Variable Cost per unit = $5 ? Fixed Costs = $10,000 ? Bonds outstanding = $15,000 ? Interest rate on outstanding bonds = 8% ? Tax Rate = 40% ? Shares of common stock outstanding = 10,000 shares ? Beta = 1.4 ?...
Question 2.1 (8 Marks) Roads Ltd is a construction company that builds roads and related civil...
Question 2.1 Roads Ltd is a construction company that builds roads and related civil projects. The company recently faced increased calls from investors to pay dividends due to the perceived lack of new profitable projects in a low growth economy. The company has, in spite of weak business sentiment, maintained a stable profit margin. At a recent meeting, the board resolved to adopt a residual approach to dividend payments. You have been tasked with recommending the dividend that should be...
Alternative: Dividend Policies: In 2013, Keenan Company paid dividends totaling $3,600,000 on net income of $10.8...
Alternative: Dividend Policies: In 2013, Keenan Company paid dividends totaling $3,600,000 on net income of $10.8 million. Note that 2013 was a normal year and that for the past 10 years, earnings have grown at 10%. However in 2014, earnings are expected to jump to $14.4 million and the firm expects to have profitable investment opportunities of $8.4 million. It is predicted that Keenan will not be able to maintain the 2014 level of earnings growth because of the high...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT