How does the marginal principle of retained earnings relate to the returns that a stockholder may make in other investments?
Answer to relevant QuestionsDiscuss the difference between a passive and an active dividend policy.How is a stock split (versus a stock dividend) treated on the financial statements of a corporation?Polycom Systems earned $553 million last year and paid out 25 percent of earnings in dividends.a. By how much did the company’s retained earnings increase?b. With 100 million shares outstanding and a stock price of $101, ...Peabody Mining Company’s common stock is selling for $50 the day before the stock goes ex-dividend. The annual dividend yield is 5.6 percent, and dividends are distributed quarterly. Based solely on the impact of the cash ...The Carlton Corporation has $5 million in earnings after taxes and 2 million shares outstanding. The stock trades at a P/E of 20. The firm has $4 million in excess cash.a. Compute the current price of the stock.b. If the $4 ...
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