Assets Liabilities and Shareholders' Equity

A. Original balance sheet

Cash $ 150,000 Debt $ 0

Other assets 950,000 Equity 1,100,000

Value of firm $ 1,100,000Value of firm $ 1,100,000

Shares outstanding = 100,000

Price per share = $1,100,000 / 100,000 = $11

Pocket wins a lawsuit and is paid $230,000 in cash. The market value of the equity rises by that amount, and Pocket decides to pay out $1.90 per share.

a.What will be Pocket's stock price if the payout comes as a cash dividend?(Do not round intermediate calculations. Round your answer to 2 decimal places.)

b.What will be Pocket's stock price if the payout comes as a share repurchase?(Do not round intermediate calculations. Round your answer to 2 decimal places.)