Universal utilities u2 applies the low regular dividend, Ask an Expert

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Universal Utilities (U2) applies the low regular dividend plus extras policy when determining how much of its income will be paid out as dividends each year. U2's policy states that the minimum dividend that will be paid each year is $0.50 per share. But, when net income is greater than $600,000, the total dividend will be increased by 25 percent of the amount that exceeds $600,000. The firm currently has 100,000 shares of stock outstanding. What will be the dividend per share if U2 earns

(a) $760,000 and

(b) $580,000?

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M92203708

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