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Mariulka [41]
3 years ago
6

The Jennings Group reacquired 3 million of its shares at $76 per share as treasury stock. Last year, for the first time, Jenning

s sold 2 million treasury shares at $77 per share.
By what amount will Jennings’ retained earnings decline if it now sells the remaining 1 million treasury shares at $73 per share? (Enter your answer in millions (i.e., 10,000,000 should be entered as 10).)
Business
1 answer:
ra1l [238]3 years ago
3 0

Answer

The answer and procedures of the exercise are attached in the following archives.

Explanation  

You will find the procedures, formulas or necessary explanations in the archive attached below. If you have any question ask and I will aclare your doubts kindly.  

Download xlsx
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Answer:

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Explanation:

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Explanation:

1. If a firm increases its dividend payout rate the: firm will have less cash available for new investment. This assertion is true because the company would be paying out a larger portion of earnings as dividends, hence the balance portion for new investment will be lower as a result.

2. Stock price will likely fall by the same percentage. This assertion is most unlikely because normally, if a particular stock is paying higher dividends investors will have high expectation and be willing to pay a higher price to buy a stock that pays high dividends

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