How much does it pay out in dividends

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Q1. Suppose that Papa Bell, Inc.'s equity is currently selling for $45 per share, with 3.0 million shares outstanding. Assume the firm also has 7,000 bonds outstanding, and they are selling at 93 percent of par. What are the firm's current capital structure weights?

Q2. Suppose a firm has a retention ratio of 60 percent and net income of $9.4 million. How much does it pay out in dividends?

Q3. If a firm has retained earnings of $4.0 million, a common shares account of $6.0 million, and additional paid-in capital of $12.0 million, how would these accounts change in response to a 10 percent stock dividend? Assume market value of equity is equal to book value of equity.

Reference no: EM132615336

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