Long Problem: Answer the following questions based on this text below. Josh Lakin is an analyst in the research department of an international securities firm. Lakin is currently analyzing Yoshi Products, a publicly traded global consumer goods company located in the United States. Selected data for Yoshi are presented in Exhibit 1 Exhibit 1 Selected Financial Data for Yeta Products Most Recent Fiscal Year Current Pretax income $280 million Net income after tax $182 million Cash flow from operations $235 million Shares outstanding Book value per share Share price 100 million $25.60 $20.00 Capital expenditures $175 million Earnings per share $1.82 Yoshi currently does not pay a dividend, and the company operates with a target capital structure of 40% debt and 60% equity. However, on a recent conference call, Yoshi's management indicated that they are considering four payout proposals: Proposal #1: Issue a 10% stock dividend. Proposal #2: Repurchase $40 million in shares using idle cash. Proposal #3: Repurchase $40 million in shares by borrowing $40 million at an after-tax cost of borrowing of 8.50%. Proposal #4: Initiate a regular cash dividend based on a residual dividend policy. Write the correct answer choice inside the box (A, B, or C) and then explain your answer in the space provided below. Problem #11: The implementation of Proposal #1 would generally lead to shareholders: A having to pay tax on the dividend received. B experiencing a decrease in the total cost basis of their shares. Chaving the same proportionate ownership as before implementation. Answer choice: Calculation/Explanation: Problem #12: If Yoshi's management implemented Proposal #2 at the current share price shown in Exhibit 1, Yoshi's book value per share after implementation would be closest to: A $25.20. B $25.71. C $26.12. Answer choice: Calculation/Explanation: Problem #13: Based on Exhibit 1, if Yoshi's management implemented Proposal # 3 at the current share price, earnings per share would: A decrease. B remain unchanged. C increase. Answer choice: Calculation/Explanation: Problem #14: Based on Exhibit 1 and Yoshi's target capital structure, the total dividend that Yoshi would have paid last year under a residual dividend policy is closest to: A $77 million. B $112 million. C$175 million. Answer choice: Calculation/Explanation: Problem #15: Based on Yoshi's target capital structure, Proposal #4 will most likely: A increase the default risk of Yeta's debt. B increase the agency conflict between Yeta's shareholders and managers. ( decrease the agency conflict between Yeta's shareholders and bondholders. Answer choice: Calculation/Explanation: Problem #16: The implementation of Proposal #4 would most likely signal to Lakin and other investors that future earnings growth can be expected to: A decrease. B remain unchanged. C increase. Answer choice: Calculation/Explanation: