EBK CONTEMPORARY FINANCIAL MANAGEMENT
14th Edition
ISBN: 9781337514835
Author: MOYER
Publisher: CENGAGE LEARNING - CONSIGNMENT
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Chapter 15, Problem 14P
Summary Introduction
To determine: The ex- dividend date.
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Kathy Snow wishes to purchase shares of Countdown Computing, Inc. The company's board of
directors has declared a cash dividend of $0.80 to be paid to holders of record on Wednesday, May
12. a. What is the last day that Kathy can purchase the stock (trade date) and still receive the
dividend? b. What day does this stock begin trading ex dividend? c. What change, if any, would you
expect in the price per share when the stock begins trading on the ex dividend day? d. If Kathy held
the stock for less than one quarter and then sold it for $39 per share, would she achieve a higher
investment return by (1) buying the stock prior to the ex dividend date at $35 per share and collecting
the $0.80 dividend or (2) buying it on the ex dividend date at $34.20 per share but not receiving the
dividend?
Kathy Snow wishes to purchase shares of Countdown Computing, Inc. The company's board of directors has declared a cash dividend of $1.13 to be paid to holders of record on Wednesday, Sep. 21.
a. What is the last day that Kathy can purchase the stock and still receive the dividend?
b. What day does this stock begin trading ex dividend?
c. What change, if any, would you expect in the price per share when the stock begins trading on the ex-dividend day?
d. Kathy believes that she will be able to sell the stock for $46.92 in a few months. Tomorrow is the ex-dividend date, and the stock price now is $42.92. Is she better off buying the stock now so she can capture the dividend, or should she wait until tomorrow, miss the dividend, and buy the stock at a slightly lower price?
On Thursday, May 18, the board of directors of ABC declares a 30-cent-per-share dividend to shareholders of record as of Tuesday, June 13. The dividend will be paid on Wednesday, June 28.
a. What is the declaration date?
b. What is the date of record?
c. What is the ex-dividend date?
d. What is the payment date?
Chapter 15 Solutions
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Ch. 15 - Prob. 1QTDCh. 15 - Prob. 2QTDCh. 15 - Prob. 3QTDCh. 15 - Prob. 4QTDCh. 15 - Prob. 5QTDCh. 15 - Prob. 6QTDCh. 15 - Prob. 7QTDCh. 15 - Prob. 8QTDCh. 15 - Prob. 9QTDCh. 15 - Prob. 10QTD
Ch. 15 - Prob. 11QTDCh. 15 - Prob. 12QTDCh. 15 - Prob. 13QTDCh. 15 - Prob. 14QTDCh. 15 - Prob. 15QTDCh. 15 - Prob. 16QTDCh. 15 - Prob. 17QTDCh. 15 - Prob. 18QTDCh. 15 - Prob. 1PCh. 15 - Prob. 2PCh. 15 - Prob. 3PCh. 15 - Prob. 4PCh. 15 - Prob. 5PCh. 15 - Prob. 6PCh. 15 - Prob. 7PCh. 15 - Prob. 8PCh. 15 - Prob. 9PCh. 15 - Prob. 10PCh. 15 - Prob. 11PCh. 15 - Prob. 12PCh. 15 - Prob. 13PCh. 15 - Prob. 14PCh. 15 - Prob. 15P
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