Question
The stock of Payout Corp. will go ex-dividend tomorrow. The dividend will be $1.25 per share, and there are 50,000 shares of stock outstanding. The
The stock of Payout Corp. will go ex-dividend tomorrow. The dividend will be $1.25 per share, and there are 50,000 shares of stock outstanding. The market-value balance sheet for Payout is shown below.
| Assets | Liabilities and Equity | ||||
| Cash | $ | 300,000 | Equity | $ | 1,250,000 |
| Fixed assets | 950,000 | ||||
a. What price is Payout stock selling for today? (Round your answer to 2 decimal places.)
| Price $ |
b. What price will it sell for tomorrow? Ignore taxes. (Do not round intermediate calculations. Round your answer to 2 decimal places.)
| Price $ |
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Financial Modeling
Authors: Simon Benninga, Tal Mofkadi
5th Edition
0262046423, 9780253337825
