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Stock dividendInvestor Personal Finance Problem Sarah Warren currently holds 200 shares of Nutri-Foods. The firm has 37,000 shares outstanding. The firm most recently had earnings available for common stockholders of $76,000, and its stock has been selling for $16 per share. The firm intends to retain its earnings and pay a 20% stock dividend. a. How much does the firm currently earn per share? b. What proportion of the firm does Sarah Warren currently own? c. What proportion of the firm will Warren own after the stock dividend? d. At what market price would you expect the stock to sell after the stock dividend? e. Discuss what effect, if any, the payment of stock dividends will have on Sarah's share of the ownership and earnings of Nutri-Foods. a. The amount the firm currently earns per share is $. (Round to the nearest cent.) b. The proportion of the firm Sarah currently owns is % (Round to two decimal places.) c. The proportion of the firm Sarah wil own after the 20% stock dividend is%. (Round to two decimal places.) d. If Nutri-Foods pays a 20% stock dividend, the market price of stock after the dividend is $. (Round to two decimal places.) e. The payment of stock dividend will Sarah's proportion of ownership and will the value of her holdings of Nutri-Foods. (Select from the drop-down menus.)Step by Step Solution
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