the dawson corporation projects the following for the year 2005 630877
Items 1 and 2 are based on the following information:
The Dawson Corporation projects the following for the year 2005:
Earnings before interest and taxes |
$35 million |
Interest expense |
5 million |
Preferred stock dividends |
4 million |
Common stock dividend payout ratio |
30% |
Common shares outstanding |
2 million |
Effective corporate income tax rate |
40% |
The expected common stock dividend per share for Dawson Corporation for 2005 is
CMA adapted
- $2.34
- $2.70
- $3.90
- $2.10
If Dawson Corporation’s common stock is expected to trade at a price/earnings ratio of eight, the market price per share (to the nearest dollar) would be
- $125
- $ 56
- $ 72
- $ 68