Answered step by step
Verified Expert Solution
Link Copied!

Question

...
1 Approved Answer

Vegas Products sells marked playing cards to blackjack dealers. It has not paid a dividend in many years but is currently contemplating some kind of

image text in transcribedimage text in transcribed

Vegas Products sells marked playing cards to blackjack dealers. It has not paid a dividend in many years but is currently contemplating some kind of dividend. The capital accounts for the firm are: Common stock (2,200,000 shares) Retained earnings $11,000,000 27,000,000 Net worth $38,000,000 The company's stock is selling for $10 per share, and it earned $2,200,000 during the year with 2,200,000 shares outstanding, indicating a P/E ratio of 10. a. Restate the capital accounts at year end after the 10% stock dividend. Common stock Retained earnings $ 1320000 2480000 Net worth 3800000 b. Restate the EPS and share price. (Assume the P/E ratio remains constant.) (Do not round intermediate calculations. Round the final answers to 2 decimal places.) b. Restate the EPS and share price. (Assume the P/E ratio remains constant.) (Do not round intermediate calculations. Round the final answers to 2 decimal places.) EPS A Share price c. How many shares would an investor end up with if he or she originally had 130 shares? Number of shares 143 shares d. If an investor originally had 130 shares, what is the investor's total investment worth before and after the stock dividend if the P/E ratio remains constant? (Do not round intermediate calculations.) Total investment 1300 Before stock dividend After stock dividend 4 A

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access with AI-Powered Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Statistics Informed Decisions Using Data

Authors: Michael Sullivan III

5th Edition

9780134133539

Students also viewed these Finance questions