Avondale will pay liquidating dividend

Assignment Help Financial Management

Reference no: EM131352363

You own 1,100 shares of stock in Avondale Corporation. You will receive a $2.60 per share dividend in one year. In two years, Avondale will pay a liquidating dividend of $75 per share. The required return on Avondale stock is 20 percent. Suppose you want only $2,000 total in dividends the first year.

What will your homemade dividend be in two years?

Reference no: EM131352363

Questions Cloud

What is the utilization rate : Customers arrive at a bank at a rate of 50 per hour. The bank has 3 tellers and on average, it takes 2 minutes to service a customer. What is the utilization rate?

Salespersn for supplier a quote to cincinati customer : Assume that a product sells for $100 per ton and that Pittsburg is the basing-point city for calculating transporation charges. Shipping from Pittsburg to a potential customer in Cincinati cost $10 per ton. What delivered price would a salespersn for..

About financial reporting alternatives : The following is true about financial reporting alternatives:

Compute the annual interest payments under each plan : Guardian Inc. is trying to develop an asset-financing plan. The firm has $350,000 in temporary current assets and $250,000 in permanent current assets. Guardian also has $450,000 in fixed assets. Assume a tax rate of 30 percent. The current interest ..

Avondale will pay liquidating dividend : You own 1,100 shares of stock in Avondale Corporation. You will receive a $2.60 per share dividend in one year. In two years, Avondale will pay a liquidating dividend of $75 per share. The required return on Avondale stock is 20 percent. Suppose you ..

The net present value of the proposal to be positive : Dan Mayer manages a factory for Clark Inc. A sales person for new factory equipment has persuaded Dan that the new equipment offered by her company would be less dangerous for the employees and lower the sound level in the factory significantly. In f..

Events involved in declaration and payment of dividends : The timeline shown is summarizing the important dates and events involved in the declaration and payment of dividends. Which of the following events occurs first in this sequence?

Include all elements of skeletal profit and loss statement : Set up a skeletal profit & loss statement with the following figures : Include all elements of the skeletal profit & loss statement, round up dollars to total amount , extend percentages to two decimal points.

Value of one share of their common stock before split : Progressive Corporation executed a 3:1 (3 for 1) common stock split on April 23, 2002. What was most probably happening to the value of one share of their common stock BEFORE the split? Progressive Corporation executed a 3:1 (3 for 1) common stock sp..

User Account

All Pages