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help me correct section D, please. I'll make sure give you thumbs up Health Systemis inc is considering a 15 percent stock dividend. The capital
help me correct section D, please. I'll make sure give you thumbs up
Health Systemis inc is considering a 15 percent stock dividend. The capital accounts are as follows: "The increase in capital in excess of par as a result of a stock dividend is equal to the shares created times (Market price - Par value). The company's stock is selling for $30 per share. The company had total eamings of $12,500,000 with 5,000,000 shares outstanding and eamings per share were $250. The firm has a PlE ratio of 12 Q. What adjustments would have to be made to the capital accounts for a 15 percent stock dividend? Show the new capital accounts. (Do not round Intermedlate calculetlons. Input your answers In dollars, not milllons (e.g.$1,230,000).) b. What a djustments would be made to EPS and the stock price? (Assume the PIE ratio remains constant) (Do not round Intermedlate celedetenens and round your enswers to 2 decimal ploces.) c. How many shares would an investor have if he or she originally ha d iop: ido hot roun dintermedilere calculations ond round your. enswer to the neorest whole share.) What is the investor's total investment worth before and after the stock dividend if the P/E ratio remains constant? (Do not round ntermedlate colculations and round your answers to the nearest whole dollar.); Answer is complete but not entirely correct. e. Assume Mr. Heart, the president of Health Systems, wishes to benefit stockholders by keeping the cash dividend at a previous level of $1.10 in spite of the fact that the stockholders now have 15 percent more shares. Because the cash dividend is not reduced, the stock price is assumed to remain at $30. What is an investor's total investment worth after the stock dividend if he/she had 100 shares before the stock dividend? Answer is complete and correct. Total investment . Under the scenario described in part e, is the investor better off? 9. As a final question, what is the dividend yield on this stock under the scenanio described in part e? (Input your answer as a percent rounded to 2 decimal pleces.) Answer is complete and correct
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