Phillips Rock and Mud is trying to determine the maximum amount of cash dividends it can pay this year. Assume its balance sheet is as follows:

Assets
Cash	$	335,000
Accounts receivable		811,000
Fixed assets		989,000
Total assets	$	2,135,000
Liabilities and Stockholders' Equity
Accounts payable	$	472,000
Long term payable		280,000
Common stock (290,000 shares at $2 par)		580,000
Retained earnings		803,000
Total liabilities and stockholders' equity	$	2,135,000

a-1. From a legal perspective, what is the maximum amount of dividends per share the firm could pay? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share

a-2. Is this realistic?

	Yes
	No

b. In terms of cash availability, what is the maximum amount of dividends per share the firm could pay? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share

c. Assume the firm earned an 10 percent return on stockholders equity last year. If the board wishes to pay out 40 percent of earnings in the form of dividends, how much will dividends per share be

Phillips Rock and Mud is trying to determine the maximum amount of cash dividends it can pay this year. Assume its balance sheet is as follows:

Assets
Cash	$	335,000
Accounts receivable		811,000
Fixed assets		989,000
Total assets	$	2,135,000
Liabilities and Stockholders' Equity
Accounts payable	$	472,000
Long term payable		280,000
Common stock (290,000 shares at $2 par)		580,000
Retained earnings		803,000
Total liabilities and stockholders' equity	$	2,135,000

a-1. From a legal perspective, what is the maximum amount of dividends per share the firm could pay? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share

a-2. Is this realistic?

	Yes
	No

b. In terms of cash availability, what is the maximum amount of dividends per share the firm could pay? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share

c. Assume the firm earned an 10 percent return on stockholders equity last year. If the board wishes to pay out 40 percent of earnings in the form of dividends, how much will dividends per share be? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share

? (Do not round intermediate calculations and round your answer to 2 decimal places.)

Dividends per share