Question

12)Planetary Travel Co. has $165,000,000 in stockholders’ equity. Common stock is $60,000,000 and the

balance is retained earnings. The firm has $280,000,000 in total assets and 3 percent of this value is in cash. Earnings for the year are $23,000,000 and are included in retained earnings.

a.	What is the legal limit on current dividends? (Do not round intermediate calculations. Input your answer in dollars, not millions (e.g., $1,234,000).)

Legal limit on current dividends

$

b.	What is the practical limit based on liquidity? (Do not round intermediate calculations. Input your answer in dollars, not millions (e.g., $1,234,000).)

Practical limit on current dividends

$

c.	If the company pays out the amount in part b, what is the dividend payout ratio? (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

Payout ratio

%

 

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Question

9

Question

9)Ralston Gourmet Foods Inc. earned $175 million last year and retained $145

million.

What is the payout ratio? (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

Payout ratio

%

. earned $175 million last year and retained $145

million.

What is the payout ratio? (Do not round intermediate calculations. Input your answer as a percent rounded to 2 decimal places.)

Payout ratio

%

 

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