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Vegas Products sells marked playing cards to blackjack dealers
Vegas Products sells marked playing cards to blackjack dealers. It has not paid a dividend in many years but is currently contemplating some kind of dividend. The capital accounts for the firm are: 0 oints Common stock (2,500,000 shares) Retained earnings $12,500,000 24,500,000 Net worth $37,000,000 The company's stock is selling for $30 per share, and it earned $7,500,000 during the year with 2,500,000 shares outstanding, indicating a P/E ratio of 10. a. Restate the capital accounts at year end after the 10% stock dividend. Common stock Retained earnings $ 13750000 24500000 Net worth 45250000 X b. Restate the EPS and share price. (Assume the P/E ratio remains constant.) (Do not round intermediate calculations. Round the final answers to 2 decimal places.) EPS $ 2.72 27.27 Share price $ c. How many shares would an investor end up with if they originally had 160 shares? Number of shares 166 shares d. If an investor originally had 160 shares, what is the investor's total investment worth before and after the stock dividend if the P/E ratio remains constant? (Do not round intermediate calculations.) Before stock dividend $ Total investment 4800 4527 After stock dividend $
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