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Dividend policy MCQ’s

1. A payment of either cash or stock out of a corporation's earnings to a firm's owners is
called a(n):
a. normal distribution.
b. retained distribution.
c. operating distribution.
D. dividend.
e. repurchase.

2. A payment by a firm to its owners from any source other than current or accumulated
retained earnings is referred to as a:
a. capital liquidation.
B. distribution.
c. special dividend.
d. repurchase.
e. stock dividend.

3. If a firm maintains its preferred debt-equity ratio and pays dividends only after meeting
its investment needs, the firm is following a dividend policy which is referred to as a
_____ dividend policy.
a. stable
B. residual
c. constant
d. remainder
e. leftover

4. What is the name given to a transaction wherein a firm buys some of its own
outstanding shares of stock?
a. stock payout
b. reverse distribution
c. stock dividend
D. repurchase
e. acquisition

5. Which one of the following is a non-cash payment made by a firm to its shareholders
that dilutes the value of each share of stock outstanding?
a. reverse stock split
b. cash distribution
C. stock dividend
d. regular dividend
e. liquidating dividend

stable e. the price-earnings ratio will decrease e. $. D. cash distribution e. book value per share will be $6. liquidating dividend 7. the earnings per share will decrease c.90. stock price will be $29. $. extra 8. total assets will remain constant D. Ignore taxes. the number of shares outstanding will increase b.83 d. total equity will increase 9. e.000 in cash dividends? A.57 b. Inc.000 shares of stock outstanding at a market price of $29 a share. special c. c. Today. Which one of the following increases the number of shares outstanding without increasing the value of the owners' equity? a.3 million and a total market value of $3.62 c.000.000 and total liabilities of $136. cyclical D. earnings per share will be $.60. How much will the dividend per share be if the firm pays out a total of $60. The common stock has a market value of $36 a share. reverse stock split C. The firm has no preferred stock outstanding.40 a share. stock repurchase b.6. $.91 . What type of dividend policy does this firm have? a. $. Global Metals. the firm is paying an annual cash dividend of $1. price-earnings ratio will be 12.60.61. The dividends for each year are equal in amount. 10. Which one of the following will result if the firm pays a cash dividend? a. $. b. pays a quarterly dividend that is based on a constant percentage of annual earnings.87 e. Morgantown Merchants is an all-equity firm with positive net income. residual b. After the dividend. The firm has total assets of $280. New England Fashions has 18. stock split d.8 million. shareholder value per share will be $27. the firm's: a. The equity of Manor Builders currently has a total book value of $1.30. The earnings per share are $2.