金融管理基础英文版第16版人大版MGH版简答题附答案BHD16eSMChapter18文档格式.docx

金融管理基础英文版第16版人大版MGH版简答题附答案BHD16eSMChapter18文档格式.docx

《金融管理基础英文版第16版人大版MGH版简答题附答案BHD16eSMChapter18文档格式.docx》由会员分享，可在线阅读，更多相关《金融管理基础英文版第16版人大版MGH版简答题附答案BHD16eSMChapter18文档格式.docx（25页珍藏版）》请在冰豆网上搜索。

Howdoesthestockholder,ingeneral,feelabouttherelevanceofdividends?

Thestockholderwouldappeartoconsiderdividendsasrelevant.Dividendsdoresolveuncertaintyinthemindsofinvestorsandprovideinformationcontent.Somestockholdersmaysaythatthedividendsarerelevant,butinadifferentsense.Perhapstheyprefertoreceivelittleornodividendsbecauseoftheimmediateincometax.

18-4.

Explaintherelationshipbetweenacompany’sgrowthpossibilitiesanditsdividendpolicy.

Thegreateracompany’sgrowthpossibilities,themorefundsthatcanbejustifiedforprofitableinternalreinvestment.ThisisverywellillustratedinTable18-1inwhichweshowfour-yeargrowthratesforselectedU.S.corporationsandtheirassociateddividendpayoutpercentages.Thisisalsodiscussedinthelifecycleofthefirm.

18-5.

Sinceinitialcontributedcapitaltheoreticallybelongstothestockholders,whyaretherelegalrestrictionsonpayingoutthefundstothestockholders?

Creditorshaveextendedcreditontheassumptionthatagivencapitalbasewouldremainintactthroughoutthelifeofaloan.Whiletheymaynotobjecttothepaymentofdividendsfrompastandcurrentearnings,theymusthavetheprotectionofkeepingcontributedcapitalinplace.

18-6.

Discusshowdesireforcontrolmayinfluenceafirm’swillingnesstopaydividends.

Management’sdesireforcontrolcouldimplythatacloselyheldfirmshouldavoiddividendstominimizetheneedforoutsidefinancing.Foralargerfirm,managementmayhavetopaydividendsinordertomaintaintheircurrentpositionthroughkeepingstockholdershappy.

18-7.

Ifyoubuystockontheex-dividenddate,willyoureceivetheupcomingquarterlydividend?

No,theoldstockholderreceivestheupcomingquarterlydividend.Ofcourse,if 

youcontinuetoholdthestock,youwillreceivethenextdividend.

18-8.

Howisastocksplit（versusastockdividend）treatedonthefinancial

statementsofacorporation?

Forastocksplit,thereisnotransferoffunds,butmerelyareductionin

parvalueandaproportionateincreaseinthenumberofsharesoutstanding.

ImpactofaStockSplit

BeforeAfter

Commonstock（1,000,000sharesat$10par）（2,000,000sharesat$5par）

18-9.

Whymightastockdividendorastocksplitbeoflimitedvaluetoaninvestor?

Theassetbaseremainsthesameandthestockholders’proportionateinterestisunchanged（everyonegotthesamenewshare）.Earningspersharewillgodownbytheexactproportionthatthenumberofsharesincreases.IftheP/Eratioremainsconstant,thetotalvalueofeachshareholder’sportfoliowillnotincrease.

Theonlycircumstancesinwhichastockdividendmaybeofsomeusefulnessandperhapsincreasevalueiswhendividendspershareremainconstantandtotaldividendsgoup,orwheresubstantialinformationisprovidedaboutthegrowthofthecompany.Astocksplitmayhavesomefunctionalityinplacingthecompanyintoalower“stockprice”tradingrange.

18-10.

Doesitmakesenseforacorporationtorepurchaseitsownstock?

Explain.

Acorporationcanmakearationalcaseforpurchasingitsownstockasanalternatetoacashdividendpolicy.Earningspersharewillgoupasthesharesdecline,andiftheprice-earningsratioremainsthesame,thestockholderwillreceivethesamedollarbenefitasifacashdividendwaspaid.Becausethebenefitsareintheformatofcapitalgains,thetaxmaybedeferreduntilthestockissold.

Acorporationalsomayjustifytherepurchaseofitsownstockbecauseitisataverylowprice,ortomaintainconstantdemandfortheshares.Reacquiredsharesmaybeusedforemployeeoptionsorasapartofatenderofferinamergeroracquisition.Firmsmayalsoreacquirepartoftheirstockasprotectionagainstahostiletakeover.

18-11.

Whatadvantagestothecorporationandthestockholderdodividendreinvestmentplansoffer?

Dividendreinvestmentplansallowcorporationstoraisefundscontinuallyfrompresentstockholders.Thisreducestheneedforsomeexternalfunds.Theseplansallowstockholderstoreinvestdividendsatlowcostsandtobuyfractionalshares,neitherofwhichcanbeeasilyaccomplishedinthemarketbyanindividual.Thestrategyofdividendreinvestmentplansallowsforthecompoundingofdividendsandtheaccumulationofcommonstockovertime.

Problems

1.Payoutratio（LO18-1）MoonandSonsInc.earned$120millionlastyearandretained$72million.Whatisthepayoutratio?

18-1.Solution:

MoonandSonsInc.

Dividends=Earnings–Retainedfunds

=$120mil.–$72mil.=$48mil.

Payoutratio=Dividends/Earnings

=$48mil./$120mil.=40.0%

2.Payoutratio（LO18-1）RalstonGourmetFoodsInc.earned$360millionlastyearandretained$252million.Whatisthepayoutratio?

18-2.Solution:

RalstonGourmetFoodsInc.

=$360mil.–$252mil.=$108mil.

=$180mil./$360mil.=30%

3.Payoutratio（LO18-1）SwankClothiersearned$640millionlastyearandhada30percentpayoutratio.Howmuchdidthefirmaddtoitsretainedearnings?

18-3.Solution:

SwankClothiers

Additiontoretainedearnings=Earnings–Dividends

Dividends=30%×

$640,000,000

=$192,000,000

Additiontoretainedearnings=$640,000,000–$192,000,000

=$448,000,000

4.Dividends,retainedearnings,andyield（LO18-1）PolycomSystemsearned$553millionlastyearandpaidout25percentofearningsindividends.

a.Byhowmuchdidthecompany’sretainedearningsincrease?

b.With100millionsharesoutstandingandastockpriceof$101,whatwasthedividendyield?

（Hint:

Firstcomputedividendspershare.）

18-4.Solution:

PolycomSystems

a.Additiontoretainedearnings=Earnings–Dividends

Dividends=25%×

$553,000,000

Dividends=$138,250,000

Earnings–Dividends=$553,000,000–$138,250,000

Additiontoretainedearnings=$414,750,000

b.Dividends/Shares=$138,250,000/100,000,000

=$1.38

Dividendyield=Dividendpershare/Stockprice

=$1.38/$101=1.37percent

5.Growthanddividendpolicy（LO18-2）Thefollowingcompanieshavedifferentfinancialstatistics.Whatdividendpolicieswouldyourecommendforthem?

Explainyourreasons.

TurtleCo.HareCorp.

Growthrateinsalesandearnings22%4%

Cashasapercentageoftotalassets520

18-5.Solution:

Turtleisgrowingveryfastandneedsitscashforreinvestmentinassets.Forthisreason,Turtleshouldhavealowpayoutratio.

Hareisnotgrowingveryfastsoitdoesn’tneedcashforgrowthunlessitdesirestochangeitspolicies.Assumingitdoesn’t,hareshouldhaveahighdividendpayout.

6.Limitsondividends（LO18-3）PlanetaryTravelCo.has$240,000,000instockholders’equity.Eightymilliondollarsislistedascommonstockandthebalanceisinretainedearnings.Thefirmhas$500,000,000intotalassetsand2percentofthisvalueisincash.Earningsfortheyearare$40,000,000andareincludedinretainedearnings.

a.Whatisthelegallimitoncurrentdividends?

b.Whatisthepracticallimitbasedonliquidity?

c.Ifthecompanypaysouttheamountinpartb,whatisthedividendpayoutratio?

（Computethisbasedontotaldollarsratherthanonapersharebasisbecausethenumberofsharesisnotgiven.）

18-6.Solution:

PlanetaryTravelCo.

a.Thelegallimitisequaltoretainedearnings

Retainedearnings=Stockholder’sequity–Commonstock

=$240,000,000–80,000,000

=$160,000,000

b.Thepracticallimitbasedonliquidityisequaltothecashbalance.

Cash=Cashpercentage×

Totalassets

=2%×

$500,000,000

=$10,000,000

c.Payoutratio=Dividends/Earnings

=$10,000,000/40,000,000=25%

7.Lifecyclegrowthanddividends（LO18-2）AfinancialanalystisattemptingtoassessthefuturedividendpolicyofEnvironmentalSystemsbyexaminingitslifecycle.Sheanticipatesnopayoutofearningsintheformofcashdividendsduringthedevelopmentstage（I）.Duringthegrowthstage（II）,sheanticipates12percentofearningswillbedistributedasdividends.Asthefirmprogressestotheexpansionstage（III）,thepayoutratiowillgoupto35percentandeventuallyreach58percentduringthematuritystage（IV）.

a.Assumingearningspersharewillbeasfollowsduringeachofthefourstages,indicatethecashdividendpershare（ifany）duringeachstage.

StageI$.10

StageII1.80

StageIII2.80

StageIV3.70

b.AssumeinStageIVthataninvestorowns325sharesandisina15percenttaxbracket.Whatwillbetheinvestor’saftertaxincomefromthecashdividend?

c.Inwhattwostagesisthefirmmostlikelytoutilizestockdividendsorstocksplits?

18-7.Solution:

Envir