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In-Class Chapter 18 SE 00 8 Matrix Corp Inc

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In-Class Chapter 18 SE 00 8 Matrix Corp Inc. is considering a 15 percent stock dividend. The capital accounts are as follows: Common stock (4,980, eee shares) Retained earnings Net worth $40,000,000 68,03e, eee $100, eee, eee 10 points eBook The company's stock is selling for $40 per share. The company had total earnings of $12.000.000 with 4.000.000 shares outstanding and EPS were $3.00. The firm has a P/E ratio of 13.33.(rounded) a. Restate the equity section at year end after the 15 percent stock dividend. Show the new capital accounts. Print Common stock Retained earnings $ 3060000 2340000 References Net worth b. Restate the EPS and share price after the stock split (Assume the P/E ratio remains constant). (Do not round Intermediate calculations. Round the final answers to 2 decimal places.) $ EPS Share price 2.61 31.3 c. How many shares would an investor have if they originally had 100? Number of shares 92 shares d. What is the investor's total investment worth before and after the stock dividend if the P/E ratio remains constant? (There may be a slight difference due to rounding.) (Do not round Intermediate calculations. Round the After stock dividend answer to 2 decimal places.) Before stock dividend After stock dividend Total investment $ 2880 $ 2880 e-1. Assume Mr. Neo, the president of Matrix Corp., wishes to benefit the shareholder by keeping the cash dividend at a previous level of $1.05 in spite of the fact that the shareholders now have 15 percent more shares. Because the cash dividend is not reduced, the share price is assumed to remain at $40. What is an investor's total investment worth after the stock dividend if they had 100 shares before the stock dividend? Total investment $1 --2. Under the scenario described in parte-1, is the investor better off? Yes No f. What is the dividend yield on the shares under the scenario described in part e-1 (Round the final answer to 2 decimal places.) Dividend yield %