1. Dividends on Preferred and Common Stock

   Pecan Theatre Inc. owns and operates movie theaters throughout Florida and Georgia. Pecan Theatre has declared the following annual dividends over a six-year period: Year 1, $48,000; Year 2, $96,000; Year 3, $216,000; Year 4, $264,000; Year 5, $348,000; and Year 6, $432,000. During the entire period ended December 31 of each year, the outstanding stock of the company was composed of 30,000 shares of cumulative preferred 4% stock, $100 par, and 100,000 shares of common stock, $5 par.

   Required:

   1. Determine the total dividends and the per-share dividends declared on each class of stock for each of the six years. There were no dividends in arrears at the beginning of Year 1. Summarize the data in tabular form. If required, round your answers to two decimal places. If the amount is zero, please enter "0".

   						Preferred Dividends								Common Dividends
   Year		Total Dividends				Total				Per Share				Total				Per Share
   Year 1		$   48,000				$				$				$				$
   Year 2		96,000
   Year 3		216,000
   Year 4		264,000
   Year 5		348,000
   Year 6		432,000
   										$								$

   2. Determine the average annual dividend per share for each class of stock for the six-year period. If required, round your answers to two decimal places.

   Average annual dividend for preferred	$ per share
   Average annual dividend for common	$ per share

   3. Assuming a market price per share of $204 for the preferred stock and $9 for the common stock, determine the average annual percentage return on initial shareholders' investment, based on the average annual dividend per share for preferred stock and for common stock.

   Round your answers to two decimal places.

   Preferred stock	%
   Common stock	%

Check My Work

Consider the following information on the stock market.

1. Compute a price-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change?
2. Compute a value-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change?

Consider the following information on the stock market.

1. Compute a price-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change?

2. Compute a value-weighted stock price index for the beginning of the year and the end of the year. What is the percentage change?

Calculate the net present value at year 0 for the following cash flows and interest rates compounded semi-annually (rounded $ to two places after the decimal). The year 0 cash flow is $373, the year 1 cash flow is $200, and the year 2 cash flow is $-147. The interest rate for the first period (year 0 to 1) is 3% and the interest rate for the second period (year 1 to 2) is 4.5%.

The returns for AhhChocolate.com over the last 5 years are given below. Assuming no dividends were paid, what is the 5-year “average” Holding Period (Geometric) Return for AhhChocolate? Year 1 return = 5.3% Year 2 return = - 4.6% Year 3 return = - 3.2% Year 4 return = 1.2% Year 5 return = 3.5%

A) 0.368%

B) 3.550%

C) 8.400%

D) 2.200%

E) 0.440%

On January 1 of the current year, Jimmy's Sandwich Company reported stockholders’ equity totaling $125,000. During the current year, total revenues were $100,000 while total expenses were $89,500. Also, during the current year paid $24,000 in cash dividends. No other changes in equity occurred during the year. If, on December 31 of the current year, total assets are $200,000, the change in total stockholders’ equity during the year was:

Growth and development: In 2017, Ethiopia had a per capita income of $1,600, about $4 per day. Compute per capita income in Ethiopia for the year 2050 assuming average annual growth is

1. 1% per year.
2. 2% per year.
3. 4% per year.
4. 6% per year. (
5. For comparison, per capita income in Mexico in the year 2017 was nearly $17,000, about 30 percent of the U.S. level.)

Suppose that annual income from a rental property is expected to start at $1330 per year and decrease at a uniform amount of $70 each year after the first year for the 16 year expected life of the property. The investment cost is $6900 and i is %10 per year. What is the present equivalent of the rental income? Assume that the investment occurs at time zero (now) and that the annual income is first received at the end of first year

"A new delivery truck is available for $200,000. O&M costs are $21,000 each year for the first five years, $33,600 in year six, $52,100 in year seven, and $81,300 in year eight. Salvage values are estimated to be $150,000 after one year and will decrease at the rate of 17% per year thereafter. At a MARR of 17%, determine the economic service life of the truck. Enter your answer as an integer from 1 to 8."