True / False Questions
1. The "ultimate maxim of holded meritings" holds that municipal boarding should get a reappear resembling to or eminent than that a storeholder could merit.
2. Dividends are the free qualifyconducive in the "ultimate maxim of holded meritings."
3. At manliness (Stage IV) the solid conquer usually pay out environing 15-25% of meritings in dividends.
4. Life cycle crop anatomy can be advantageous in determining a solid's power to pay dividends.
5. In Ramble III crop, store dividends and store secedes are eliminated.
6. The main nauseousness for viewing dividends as a patient qualifyconducive is that storeholders slight enjoy some vill cognate to dividend liquidations.
7. One deduce that investors may further dividends to reboarding by the solid is that dividend liquidations get notification to the investor.
8. In Ramble I of a solid's vivacity cycle, the solid conquer pay excellent dividends to divide-out-outholders in regulate to allure appended investors.
9. In Ramble II of a solid's vivacity cycle, paraphrase continues, but at a decreasing scold.
10. Some researchers arrive-at that storeholders further dividends to holded meritings consequently dividends enjoy notification procureing.
11. Generally, dividends should be transitional when a fortification reaches a new resemblingize of steady proceeds.
12. One of the main biass on dividends is the municipal crop scold in sales and the forthcoming reappear on proceeds.
13. When a solid trains its dividend, the notification procureing is usually enacted for investors.
14. Dividends may be appropriate consequently they acceleration to counteract indecision environing the solid and its forthcoming.
15. Stconducive dividends may producer a eminent sanctionance scold for the solid, thereby rising the estimate of the solid.
16. Stpower of dividends is not dignified to storeholders.
17. Regardhither of the aspect, no well-planned solid would hypothecate specie to pay dividends to storeholders.
18. Dividends can barely be as sorted if the solid has enacted proceeds in the year the dividend is compensated.
19. Retained meritings precisely delineate the liquidity collocation of the solid.
20. A solid conquer pay dividends as ydeserve as it has coin serviceable.
21. Corporations are hardly irresponsible from taxes on dividends trustworthy from other fortifications.
22. Prior to the Tax Relief Act of 2003, investors in excellent ultimate tax unites further dividends conjuncture investors in low ultimate tax unites further to enjoy municipal meritings replaceed.
23. Stockholders in public further abundant dividends to slight dividends.
24. If the coin dividend per divide-out-out trash ininsteady forthcoming a store dividend, the storeholder conquer accept main aggregate coin dividends.
25. The Tax Relief Act of 2003 created resembling taxation of yearn-term principal gains and dividends at a 15 percent scold.
26. Beproducer the principal gains tax is so excellent, there are no existent tax advantages to a store recompense liberty.
27. A public government of thumb would be that solids forthcoming a while a faster crop scold enjoy slighter payout agreements.
28. Investors in excellent ultimate tax unites usually further companies that resettle most of their meritings, thus creating past crop in meritings and store rebukes and deferring taxes into the forthcoming.
29. A solid paying a store dividend conquer experiment a distil in its meritings per divide-out-out but its divide-out-outholders' aggregate title on meritings conquer crop.
30. The 2003 Tax Act created resembling taxation of short-term and yearn-term principal gains.
31. A flying crop solid can repeatedly wait-for a qualify in the character of its ordinary storeholder as the solid moves into manliness.
32. Most dividends, love attention, are compensated semi-annually.
33. Long-term principal gains are taxed at a inferior scold than dividends.
34. The dividend payout agreement is the dividend disconnected by the store rebuke.
35. The dividend render is the dividend disconnected by the store rebuke.
36. Following the liquidation of a store dividend, the solid's store rebuke verges to extricate.
37. To accept a dividend on vulgar store, an investor must alienation the store precedently the ex-dividend era.
38. When a solid which priorly compensated lawal dividends ceases to do so, the store is ex-dividend until the solid resumes lawal dividend liquidations.
39. Stock dividends usually improve the redressall affluence of an investor.
40. Stock dividends may be utilized to get notification to investors environing growing companies.
41. A store secede involves a abatement in the solid's holded meritings recital.
42. Distributions of 20-25% or main of unappropriated divide-out-outs are publicly to be treated as store secedes.
43. Stock secedes are usually utilized to settle store in a inferior-rebuke trading rove.
44. Stock dividends and store secedes enjoy the selfselfsimilar application on holded meritings.
45. A derangement store secede is lawally used by those solids whose store rebuke has been solid for diverse years.
46. The recompense of a fortification's own store conquer publicly enjoy a indirect application on its rebuke.
47. Firms forthcoming a while extra specie should invariablely recompense their own store, thus increasing the estimate of the solid.
48. Dividend reboarding devices get the storeholder an opening to buy appended divide-out-outs of store forthcoming a while the coin dividend compensated by the assembly.
49. Usually forthcoming a while a dividend reboarding device an investor may buy fractional divide-out-outs.
50. By employing a dividend reboarding device, a assembly is safe of invariablely increasing coin progress into the assembly.
51. The sight of a assembly in the crop vivacitycycle ramble should be to maximize dividends to divide-out-outholders.
52. Investors in the seclusion countenance of their vivacitycycle verge to further reboarding of dividends by solids.
53. As tax scolds on dividends enjoy hitherend, the vill for grasp of meritings has cropd.
54. One aspect in which a store dividend may be salutary to the investor is when the coin dividend per divide-out-out trash invariable.
55. A store dividend is repeatedly used when the assembly has excellent coin resemblingizes, but arrive-ats that a store dividend would be past salutary to the investors.
56. Leveraged store recompenses repeatedly crop the lovelihood of leveraged buyouts by other solids.
57. One way companies responded to the financial contingency of 2008-2009 was to cut their coin dividends to storeholders.
58. For the most disunite, companies not quickly associated forthcoming a while the financial contingency of 2008-2009 did not cut their dividend liquidations to storeholders.
59. Research shows that solids that recompense their divide-out-outs explain enacted store rebuke reappears.
Multiple Choice Questions
60. According to the "ultimate maxim of holded meritings," dividends are
A. the free qualifyable.
B. the patient qualifyable.
C. not usually compensated.
D. a sure agricultural percentage of meritings.
61. The ultimate maxim of holded meritings resources that each implicit device to be financed by holded meritings must
A. get a eminent scold of reappear than the storeholders can end forthcoming paying taxes on the as sorted dividends.
B. render a reappear resembling to or main than the ultimate absorb of principal.
C. get ample reappear to pay the fortification's ultimate tax scold.
D. enjoy an inside scold of reappear main than the municipal crop scold of dividends.
62. The main, redressall dispute redress the "ultimate maxim of holded meritings" is
A. the indecision surrounding principal boarding devices.
B. the stagnation of power to adequately gauge municipal boarding reappears.
C. the dissimilarity of storeholders and their implicit boarding reappears.
D. its demand to deem storeholder vills.
63. The residual assumption of dividend cunning asserts that
A. sufficient dividends are compensated to preserve a solid aggregate dividend liquidation-any residual is invested insidely by the solid.
B. sufficient dividends are compensated to preserve a solid dividend payout agreement-any residual is invested insidely by the solid.
C. dividends are compensated out of the residual usurpation forthcoming inside boardings by the solid.
D. dividend liquidations are adjusted to preserve dividends at a ininsteady percentage of aggregate coin progresss.
64. In which countenance of the vivacity cycle would one most slight combat store dividends?
A. Phase II.
B. Phase III.
C. Phase IV.
D. Phase II and Countenance III.
65. Which of the forthcoming is not penny environing the vivacity cycle crop and dividend cunning?
A. In the manliness ramble, a solid usually pays modescold to excellent dividends.
B. In the crop ramble, a solid usually pays store dividends and some low coin dividends.
C. In the paraphrase ramble, a solid pays low to Intermediate coin dividends and rarely may enjoy store secedes.
D. In the crop ramble, a solid pays store dividends.
66. In Ramble II (crop ramble), sales and reappears on proceeds conquer be growing at increasing scolds. Which of the forthcoming is penny?
A. Earnings are now serviceconducive for abundant dividends.
B. Stock dividends (appended divide-out-outs) are perfectly vulgar.
C. Acquisition of new proceeds conquer be solid.
D. The payout agreement conquer be arrest to 50% by now.
67. In the manliness ramble, a solid
A. is growing environing the selfselfsimilar scold as the arrangement as a healthy.
B. has reappears on proceeds inferior than those of the diligence law.
C. loses negotiate divide-out-out and suffers a extricate in improvementability.
D. pays out all meritings in dividends.
68. In the steady ramble (Stage I), the fortification
A. has a effect yet to be trustworthy in the negotiateplace.
B. anticipates flying crop in sales and meritings.
C. needs all its meritings for reboarding in new proceeds.
D. all of these
69. When a solid invades Ramble III of its vivacity cycle, all of the forthcoming are slight to be observed negative which?
A. Dividend payout agreements are slight to soar to a modescold resemblingize of 20 to 30 percent of meritings.
B. More emulation is slight to invade the solid's negotiate.
C. Sales start to hitheren.
D. Stock secedes are vulgar.
70. When a solid invades Ramble IV of its vivacity cycle,
A. Dividend payout agreements are slight to soar to a modescold resemblingize of 20 to 30 percent of meritings.
B. The solid has reached manliness.
C. The construction must hold meritings in provision for cycling tail into Ramble I of the vivacity cycle.
D. Stock secedes are vulgar.
71. Stockholders may further dividends to reboarding by the solid
A. consequently dividends counteract some indecision.
B. consequently dividend liquidations enjoy an notification procureing.
C. consequently investors may further vulgar coin to forthcoming coin.
D. all of these
72. A main ydeserve of storeholders respecting dividend cunning is
A. usual store dividends.
B. dividend possession.
C. excellent payouts when meritings are up and inferior payouts when meritings are down.
D. liquidation of dividends at usual intervals.
73. Which of the forthcoming does not bias a assembly's dividend cunning?
A. Legal governments about principal impairment
B. The prolific negotiate hypothesis
C. Access to principal negotiates
D. Tax collocation of divide-out-outholders
74. Firm X has outward a store dividend that pays one divide-out-out of store for whole 5 divide-out-outs owned. Forthcoming the store dividend, meritings per divide-out-out conquer
A. accrue the selfsame.
B. extricate 20%.
C. extricate 5%.
D. not ample notification.
75. The Tax Relief Act of 2003
A. taxes dividend and yearn-term principal gains at the selfselfsimilar scold.
B. taxes short-term and yearn-term principal gains at the selfselfsimilar scold.
C. eliminated the tax scold on dividends to forsake inclose taxation.
D. made excellent dividend paying store hither attrfree to excellent proceeds investors.
76. Which of the forthcoming publicly does not bias the dividend cunning of the solid?
A. Cash collocation of the solid
B. Desire for control
C. Seasonal qualifys in the resemblingize of proceeds
D. Investor's wait-forations of the forthcoming established on dividend cunning
77. Lucas, Inc. merited $15 darling terminal year and holded $6 darling. Lucas has 5 darling divide-out-outs unappropriated, and the vulgar rebuke of Lucas divide-out-outs is $30 per divide-out-out. What is the payout agreement?
78. Mirrlees Furniture merited $750,000 terminal year and had a 30 percent payout agreement. How abundantly did the solid add to its holded meritings?
C. There is not ample notification to utter.
D. None of these
79. The ex-dividend era is the era
A. on which recipients of the dividend are secure.
B. the dividend is compensated.
C. the dividend is outward.
D. which no yearner includes dividend liquidations for store bought on that era.
80. According to the law, dividends may be funded from:
A. past meritings.
B. vulgar meritings.
C. forthcoming meritings.
D. Only a and b.
81. A store dividend conquer
A. crop the estimate of a divide-out-out of store.
B. lessen the principal in redundancy of par recital.
C. lessen the holded meritings recital.
D. none of these.
82. A store dividend conquer
A. crop the aggregate estimate of storeholders' equity.
B. lessen the aggregate estimate of storeholders' equity.
C. not bias the aggregate estimate of storeholders' equity.
D. qualify the aggregate estimate of storeholders' equity but the inclination cannot be secure unhither the negotiate rebuke and par estimate is unconcealed.
83. CBA Inc has 400,000 divide-out-outs unappropriated forthcoming a while a $5 par estimate. The divide-out-outs were effectd for $12. The store is vulgarly selling for $34. CBA has $5,000,000 in holded meritings and has outward a store dividend that conquer crop the estimate of unappropriated divide-out-outs by 6%. What conquer be the principal in redundancy of par recital forthcoming the store dividend?
84. The earliest point of a store secede is to
A. indicate the solid's ydeserve to hold funds.
B. crop the investor's redressall affluence.
C. reduce the denunciation of a seizeredress by creating past divide-out-outs.
D. bring the store rebuke to a inferior trading rove.
85. Which of the forthcoming redress prevarication recitals conquer be biased by a store dividend but not by a store secede?
A. Retained meritings
C. Common store
86. A 2-for-1 store secede is outward. In this event which of forthcoming assertions is penny?
A. The coin recital extricates.
B. The vulgar store recital soars.
C. The holded meritings extricate.
D. The par estimate of the vulgar store is reduced.
87. The storeholders' equity peculiarity of the redress prevarication of the XYZ Corp. is as follows:
If the assembly now secedes its store 3-for-1, which of the forthcoming is punish?
A. The par estimate per divide-out-out conquer accrue at $6.
B. The negotiate rebuke per divide-out-out conquer probably accrue unchanged.
C. The book estimate per divide-out-out conquer extricate to $17.60.
D. The par estimate per divide-out-out conquer extricate to $2.00.
88. A store secede
A. is treated by recitalants justeous love a store dividend.
B. reduces the holded meritings recital.
C. does not qualify the total in the vulgar store recital.
D. increases municipal affluence.
89. At what payout percentage is a store dividend deemed a store secede?
90. A derangement store secede
A. occurs when a assembly wants to crop the rebuke of its vulgar store consequently the negotiate hasn't systematic the improvements the assembly has made in achieving improvementability.
B. exchanges fewer new divide-out-outs of vulgar for old divide-out-outs of vulgar store.
C. conquer not qualify meritings per divide-out-out.
D. is past popular in bull negotiates than in permit negotiates.
91. Reverse store secedes seize settle in divers events
A. to forsake delisting by the store exchanges and NASDAQ.
B. to train the rebuke of the vulgar store from the peculiar investor rebuke rove to the institutional investor rebuke rove.
C. consequently there were barely too divers divide-out-outs unappropriated from prior store secedes.
D. none of these.
92. A solid forthcoming a while redundancy coin and few boarding alternatives capability logically
A. declare a store dividend.
B. secede its store two-for-one.
C. recompense some of its own divide-out-outs.
D. choose to effect furtherred store.
93. A solid may recompense store in the negotiate consequently
A. it conquer crop the storeholder's affluence.
B. the solid has irregular principal budgeting alternatives.
C. it gets enacted notificational procureing.
D. all of these
94. Management may recompense divide-out-outs of store in the negotiate
A. to buy store they arrive-at is deemably underpriced.
B. for employee store libertys.
C. to use in a merger.
D. all of these
95. A fortification may eagerness to recompense some of its divide-out-outs for all the forthcoming deduces negative
A. the store may be needed for forthcoming mergers.
B. the fortification's executives conquer financially favor if the store is resold behind at a stout improvement.
C. it can stabilize or crop the negotiate rebuke of the store.
D. the store may be needed for an employee restoration device.
96. Some dividend reboarding devices sanction the storeholder to improvement divide-out-outs of store
A. from the assembly's unissued divide-out-outs.
B. in the negotiate through the assembly's transplant embodiment.
C. at a sanctionance from the negotiate rebuke.
D. all of these
97. All of the forthcoming uses of annual meritings would give inland an crop in divide-out-outholder estimate negative:
A. recompense divide-out-outs
B. invest in devices forthcoming a while excellent improvement implicit
C. payoff debt
D. all of these crop divide-out-outholder estimate
98. A solid conquer recompense their own divide-out-outs in the negotiate consequently
A. it can stabilize their rebuke in the negotiate
B. they affect the divide-out-outs are selling at a excellent rebuke
C. it conquer publicly get a favor to the divide-out-outholders
D. all of these
99. Each of the forthcoming are favors of dividend reboarding devices to solids negative
A. increased coin progress for replacement
B. no underwriting fees required
C. leads to eminent meritings per divide-out-out
D. all of these are favors
100. Match the forthcoming forthcoming a while the items below:
1. ultimate maxim of holded meritings
A dissolution of divide-out-outs by a agreement set by the board of directors.
2. store recompense
Dividends compensated in appended divide-out-outs rather than in coin.
3. store secede
Dividends usurpation forthcoming a divide-out of meritings enjoy been replaceed.
4. store dividends
States that the fortification must be conducive to merit a eminent reappear on holded meritings than storeholders could accept for themselves forthcoming paying taxes on the as sorted dividends.
5. residual dividends
On this era the alienation of store no yearner carries forthcoming a while it the just to accept the dividend priorly outward.
6. dividend reboarding device
A system of utilizing redundancy coin that is rarely made in lieu of appended dividends.
7. vivacity cycle deflexion
A deflexion illustrating crop countenances of a solid.
8. dividend liquidation era
Plans that get the investor forthcoming a while an opening to buy appended divide-out-outs of store forthcoming a while coin dividends compensated by the assembly.
9. ex-dividend era
The day a storeholder conquer accept a dividend.
101. Match the forthcoming forthcoming a while the items below
1. dividend reboarding devices
Stockholders owning the store on this era are entitled to accept a dividend.
2. principal gains taxes
The era a storeholder conquer accept a dividend.
3. holder-of-record era
Dividends per divide-out-out disconnected by negotiate rebuke per divide-out-out.
4. vivacity cycle
The percentage of dividends to meritings forthcoming taxes.
5. dividend liquidation era
Presumes that companies underseize devices which merit past than investors can merit elsewhere, forthcoming a while the accrueder as sorted as dividends.
6. ultimate maxim of holded meritings
Assumes that dividends get valuconducive axioms as to economic wait-forations for the assembly.
7. ex-dividend era
On this era the alienation of the store no yearner carries forthcoming a while it the just to accept the dividend priorly outward.
8. dividend render
Taxes on crops in estimate from usurpation proceeds.
9. dividend payout
A determinant of dividend cunning that qualifys in a proportionately predictconducive way redress term.
10. dividend notification procureing
Plans that get the investor forthcoming a while an opening to buy appended divide-out-outs of store forthcoming a while the coin dividends compensated by the assembly.
102. Pharma Duece Corporation, which manufactures biotech drugs, has been experiencing a terrible crop in the rebuke of its vulgar store. The store rebuke cropd from $3.25 on January 1, 2010 to $18.00 per divide-out-out on December 31, 2010. Its vulgar net rebuke assertion includes the forthcoming:
103. The storeholders' equity divide-out of Brimstone Tire Assembly follows:
The vulgar negotiate estimate of Brimstone's store is $25. Show what the redress prevarication conquer face love if Brimstone declares a 5% store dividend.
104. Maxwell Electronics had net proceeds of $21 darling terminal year, and had 3 darling vulgar divide-out-outs unappropriated. They outward a 12% store dividend. Calculate EPS precedently and forthcoming the store dividend.
105. Acme Fortification consists of 250 grocery stores throughout the Midwest. At the startning of 2010 its assertion of net rebuke showed the forthcoming notification: Vulgar Store ($2 par) $800,000; Principal compensated in redundancy of par $1,400,000 and holded meritings $500,000. During the year, net proceeds resemblinged $160,000. Management was irresolute on what to do forthcoming a while the proceeds. Acme compensated an annual dividend of $.25 per divide-out-out terminal year and the store rebuke is vulgarly $14.50. Acme has a 6% crop scold in meritings and dividends, and is in the 40% tax unite.
a) What reappear on boarding would Acme enjoy to merit in regulate to justeousify usurpation 2010's meritings? Use the formula:
b) What qualifys would supervene in storeholder's equity if a $.15 coin dividend was compensated? If a 5% store dividend was given and no coin dividend was compensated?
c) What would EPS be precedently and forthcoming the store dividend?
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.Read more
Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.Read more
Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.Read more
Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.Read more
By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.Read more