PROBLEM:

The Barryman Drilling Company was initially planning on repurchasing $1,057,500 worth of the company's 470,000 shares of stock, which is currently trading at a price of $10.21 per share. Stan Barryman is the founder of the company and still holds 11,000 shares of company stock that he originally purchased for $8.02 per share. After consideration, the company is reconsidering its plan to repurchase its common stock and instead plans to pay the $1,057,500 as a cash dividend, which amounts to $2.25 per share of common stock. If dividends are taxed at 15 percent, what tax liability does this create for Stan Barryman? What will be Stan's after-tax proceeds from the dividend distribution?

-----------------------------------

QUESTIONS:

Stan's tax liability on the dividends is $(?). (Round to the nearest dollar.)

Stan's after-tax proceeds from the dividend distribution will be $(?). (Round to the nearest dollar.)