Calculate total dividends

Assignment Help Financial Accounting
Reference no: EM133010222

Question - In 2000, you paid dividends of Rs.2,500,000 out of net income of Rs.9.8 million. You had constant long-run growth rate of 10%. However, in 2001, earnings are supposed to be Rs.13.4 million and you need investment of Rs.7.4 million. You do not expect to continue the growth of 2001 and will sustain the original growth rate of 10%. The capital structure is 40% debt and 60% equity.

Required - Calculate total dividends for 2001 under following alternatives:

a. 2001 dividend payment will remain at the long-run growth rate in earnings.

b. Dividend payout ratio of 2000 will continue.

c. You follow residual dividend model.

Reference no: EM133010222

Questions Cloud

How much is your optimal hedge ratio : You want to hedge your rice crop of 8,000 bushels in September by corn futures. How much is your optimal hedge ratio
What course of action would you recommend to your CEO : Assume that you are the CFO of a Company contemplating a stock repurchase next quarter. What course(s) of action would you recommend to your CEO
Find the standard deviation of annual returns : In a 5-year period, the annual returns on an investment are 5%, -3%, -4%, 2% and 6%. Find the standard deviation of annual returns on this investment
Calculate a firm net working capital : Calculate a firm's net working capital given the following information: Current liabilities = $78 million and Current assets = $206 million
Calculate total dividends : In 2000, you paid dividends of Rs.2,500,000 out of net income of Rs.9.8 million. Calculate total dividends
Compute the cost of the units transferred : Compute the cost of the units transferred to the next department for materials, labor, overhead, and in total for January
What dollar volume of sales per month is required : At the original selling price of $160 a unit, what dollar volume of sales per month is required for Diana Company to break-even
What is the three-line items of multistep income statement : What is the three-line items of the multistep income statement? Why is it important for a company to break out its income in this manner
How much is the amount of total income tax expense : How much is the amount of total income tax expense in its Statement of Comprehensive Income for the period ending December 31, 2021

Reviews

Write a Review

Financial Accounting Questions & Answers

  Financial statement analysis and preparation

Financial Statement Analysis and Preparation

  Shareholder of a company

Describe the ways that a person can become a shareholder of a company. Why Wal-Mart would split its stock?

  Financial and accounting principles

An understanding of financial and accounting principles can be a valuable tool for managers. While not all managers will find themselves calculating financial ratios or preparing annual financial data.

  Prepare a statement of cash flow using the direct method

Prepare a Statement of Cash Flow using the Direct Method and Prepare the Operations section of the Statement of Cash Flow using the Indirect Method.

  Financial accounting assignment

This assignment has one case study and two question apart from case study. Questions related to document Liquidation question and Company financial statements question - Torquay Limited

  Prepare general journal entries for goela

Prepare general journal entries for Goela Ltd

  Principles of financial accounting

Prepare the journal entry to record the acquisition of the assets.

  Prepare general journal entries to record the transactions

Prepare general journal entries to record the transactions, assuming use of the periodic inventory system

  Global reporting initiative

Compare the view espoused by the economist Milton Friedman about the social responsibilities of business with the views express by Stigler.

  Explain the iasb conceptual frameworks

Explain the IASB Conceptual Framework's perspective of users and their decisions.

  Determine the company''s financial statements

T he focus of the report is to determine the extent to which you are comfortable relying on the financial statements as presented by management .

  Computation of free cash flow

Computation of Free Cash Flow

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd