Pukri Ltd is deciding whether to pay out R90 000 in excess cash in the form...

Pukri Ltd is deciding whether to pay out R90 000 in excess cash in the form of an extra

dividend or a share repurchase. Current profits are R2,40 per share and the share sells for

R20. The abbreviated balance sheet before paying out the dividend is:

Equity 240 000 Bank/cash 90 000

Debt 160 000 Other Assets 310 000

400 000 400 000

Evaluate each alternative (i.e: pay the dividend or repurchase the shares) by:

1.1 Calculating the number of shares in issue (4)

1.2 The dividends per share (for the first alternative, i.e. pay the dividend) (2)

1.3 Calculate:

1.3.1 The new share price (6)

1.3.2 The EPS (4)

1.3.3 The price-earnings ratio (4)

Solutions

Expert Solution

SEE THE IMAGE. ANY DOUBTS, FEEL FREE TO ASK. THUMBS UP PLEASE

jeff jeffy answered 1 year ago

Next > < Previous

Related Solutions

Pukri Ltd is deciding whether to pay out R90 000 in excess cash in the form...

Pukri Ltd is deciding whether to pay out R90 000 in excess cash in the form of an extra dividend or a share repurchase. Current profits are R2,40 per share and the share sells for R20. The abbreviated balance sheet before paying out the dividend is: Equity 240 000 Bank/cash 90 000 Debt 160 000 Other Assets 310 000 400 000 400 000 Evaluate each alternative (i.e: pay the dividend or repurchase the shares) by: 1.1 Calculating the number of...

Pukri Ltd is deciding whether to pay out R90 000 in excess cash in the form...

Pukri Ltd is deciding whether to pay out R90 000 in excess cash in the form of an extradividend or a share repurchase. Current profits are R2,40 per share and the share sells forR20. The abbreviated balance sheet before paying out the dividend is:Equity 240 000 Bank/cash 90 000Debt 160 000Other Assets 310000400 000400 000Evaluate each alternative (i.e: pay the dividend or repurchase the shares) by:1.1 Calculating the number of shares in issue (4)1.2 The dividends per share (for the...

QUESTION ONE Pukri Ltd is deciding whether to pay out R90 000 in excess cash in...

QUESTION ONE Pukri Ltd is deciding whether to pay out R90 000 in excess cash in the form of an extra dividend or a share repurchase. Current profits are R2,40 per share and the share sells for R20. The abbreviated balance sheet before paying out the dividend is: Equity:240 000 Bank/cash: 90 000 Debt: 160 000 Other Assets: 310 000 400 000 400 000 Evaluate each alternative (i.e: pay the dividend or repurchase the shares) by: 1.1 Calculating the number of...

Pukri LTD is deciding whether to pay out R90 000 in excess in the form of an extra dividend or a share repurchase.

Pukri LTD is deciding whether to pay out R90 000 in excess in the form of an extra dividend or a share repurchase. Current profits are R2,40 per share and the share sells for R20. The abbreviated balance sheet before paying out the dividend isEquity 240 000 Bank/cash 90 000Debt 160 000 Other Assests 310 000 400 000 400 000Evaluate each alternative (I.e.: pay the dividend or repurchase the shares) by:Calculating the number of shares in issue1.2 The dividends per...

11.1.2 FINANCIAL MANAGEMENT [100] QUESTION ONE [20] Pukri Ltd is deciding whether to pay out R90...

11.1.2 FINANCIAL MANAGEMENT [100] QUESTION ONE [20] Pukri Ltd is deciding whether to pay out R90 000 in excess cash in the form of an extra dividend or a share repurchase. Current profits are R2,40 per share and the share sells for R20. The abbreviated balance sheet before paying out the dividend is: Equity 240 000 Bank/cash 90 000 Debt 160 000 Other Assets 310 000 400 000 400 000 Evaluate each alternative (i.e: pay the dividend or repurchase the...

Based on the following information: Net cash flow = R90 000 per year Useful life =...

Based on the following information: Net cash flow = R90 000 per year Useful life = 5 years Cost of capital = 8% Initial investment = R300 000 calculate the internal rate of return (IRR) of the project. (a) 0 % (b) 15.24 % (c) 8.00 % (d) 12.36% (d) None of the above

On 1 July 2018 Mi Ltd issues $32 000 000 in five-year debentures that pay interest...

On 1 July 2018 Mi Ltd issues $32 000 000 in five-year debentures that pay interest each six months at a coupon rate of 8 per cent. At the time of issuing the securities, the market requires a rate of return of 6 per cent. Interest expense is determined using the effective-interest method. Note: PV and Annuity tables are provided on the last page of this document REQUIRED Determine the issue price. Show the calculations in the table opening/closing values...

You are looking to take out a $53 ,000 loan to pay for school. The loan...

You are looking to take out a $53 ,000 loan to pay for school. The loan would be a five-year loan. The lender offers you a 8 % interest rate on the loan and also offers to structure it in one of three ways: a) As a discount loan b) As an interest-only loan c) As an amortized loan. Rounded to the nearest whole dollar, what will be your balance at the end of year 1 if you take the...

board is deciding whether it should pay a liquidating dividend of $ 50 per share or...

board is deciding whether it should pay a liquidating dividend of $ 50 per share or an equivalent extraordinary annual dividend. The finance department got the following relevant information for making the decision: a. 85% of the shareholders are between 30 and 50 years old. The remaining 15% is more than 70 years old. b. The average tax bracket of Payola’s shareholders is 25% higher than the average of the investors in public companies in the country. c. The government...

A city is deciding whether to pay a locally owned construction firm to build a new...

A city is deciding whether to pay a locally owned construction firm to build a new bridge. The city would finance the construction by borrowing. They would raise local property taxes to collect $20M more per year than they would without the new bridge. (M stands for million.) The extra $20M per year would repay the loan and pay for maintenance and all other costs of operating the bridge during its 50 year lifetime. The government expects that the demand...

Subjects