Phillips Rock and Mud is trying to determine the maximum amount of cash dividends it can pay this year. Assume its balance sheet is as follows:

Assets

Cash $ 351,000

Accounts receivable 882,000

Fixed assets 1,086,000

Total assets $ 2,319,000

Liabilities and Stockholders' Equity

Accounts payable $ 541,000

Long term payable 308,000

Common stock (280,000 shares at $1 par)

280,000 Retained earnings 1,190,000

Total liabilities and stockholders' equity $ 2,319,000

a-1. From a legal perspective, what is the maximum amount of dividends per share the firm could pay? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share=

a-2. Is this realistic? YES or NO

b. In terms of cash availability, what is the maximum amount of dividends per share the firm could pay? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share=

c. Assume the firm earned an 10 percent return on stockholders equity last year. If the board wishes to pay out 50 percent of earnings in the form of dividends, how much will dividends per share be? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share=

Homework 8 A Saved 19 Phillips Rock and Mud is trying to determine the maximum amount of cash dividends it can pay this year. Assume its balance sheet is as follows: 1.73 points $ 351,800 882,000 1,086, eee $2,319,00 eBook Assets Cash Accounts receivable Fixed assets Total assets Liabilities and Stockholders' Equity Accounts payable Long term payable Common stock (280, eee shares at $1 par) Retained earnings Total liabilities and stockholders' equity $ 541,800 398, eee 280,000 1,19e.eee , $2,319,000 Hint Print a-1. From a legal perspective, what is the maximum amount of dividends per share the firm could pay? (Do not round Intermediate calculations and round your answer to 2 decimal places.) Dividends per share a-2. Is this realistic? O Yes O No b. In terms of cash availability, what is the maximum amount of dividends per share the firm could pay? (Do not round Intermedlate calculations and round your answer to 2 decimal places.) Dividends per share c. Assume the firm earned an 10 percent return on stockholders' equity last year. If the board wishes to pay out 50 percent of earnings in the form of dividends, how much will dividends per share be? (Do not round Intermediate calculations and round your answer to 2 decimal places.) Dividends per share