Three theories of dividends

Reference no: EM1336815

You are a controller or a CFO of DuPont Corporation and you have two major decision:

1. You determine the capital structure of your company; therefore you must compare the two theories of capital structure and determine what mix of capital structure your company.

2. Your second decision the recession has hit your company "hard" and limited the company's cash. The company has long standing policy of paying cash dividends. You must discuss the pro and con of dividends and to some other form of payout plan. Also discuss the three theories of Dividends: Irrelevance theory, Bird in the hand theory, and tax preference theory.

Reference no: EM1336815

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