Calculate the after tax income

Reference no: EM1347157

You purchase CSH stock for $40 and it is now selling for $50. The company has announced that it plans a $10 special dividend. Assuming 2008 tax rates, if you sell the stock or wait and receive the dividend, will you have different after tax income? If the capital gains tax rate is 33% and the dividend tax rate is 42%, what is the difference between the two options in part (a)?

Reference no: EM1347157

Questions Cloud

What kind of interference does the person sense : The system is released from rest, and the string moves without slipping over pulley. If the larger mass is traveling at a velocity of 2.25 m/s when it has dropped 1m, how much mechanical energy was lost due to friction in the pulley's axle.

Explain what do you think mcdonald new launch : Explain what do you think McDonald's new launch will have a sustainable impact on its bottom line.

Explain what are advantages and disadvantages of debt : Explain what are the advantages and disadvantages of debt and why is the cash position of a company important, when deciding to create a dividend policy?

Measuring performance with product costing data : The following table presents the weekly average of direct materials costs per unit for two products. How could the manager of the department that makes these products use this information?

Calculate the after tax income : Suppose you buy CSH stock for 40$ and its now selling for 50$. The corporation has declared that it plans a $10 special dividend. Suppose 2008 tax rates, if you sell stock or wait and receive dividend.

Explain how much do you believe will be the budget share : Suppose that after five years consumer spending doubles to 400. Explain how much do you believe will be the budget share of leisure.

Show the concept of a just-meaningful pay increase : A company of 15 employees has recently decided to overhaul its performance appraisal system and which plan would be most appropriate for the company to adopt

Probability of heavy- normal and light snowfalls : Brenda evaluates the probability of heavy, normal, and light snowfalls as 0.25, 0.6, and 0.15, respectively. So what must be size of the order you would suggest to Brenda? Justify why.

Define the final temperature of the coffee : A glass window pane is exactly 20 cm by 36 cm at 10oC. By how much has its area increased as it temperature is 33oC, assuming that it can expand freely? Take the coefficient of thermal expansion for the glass to be exactly 9 x 10-6/Co.

User Account

All Pages