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es. . . . . . . . . . . . . . . . . . . . . . . . . . . .  800,000  Variable costs. . . . . . . . . . . . . . . . . . . . .  . 362,500  Fixed Operating costs. . . . .. . . . . . . . . .  . 187,500  Income tax rate . . . . . . . . . . . . . . .      30%  Dividend growth rate . . . . . . . . . . . . . . . .       2%    Required:  Compute the following:  Net Income available to Common  DOL  DFL  DTL

es. . . . . . . . . . . . . . . . . . . . . . . . . . . .  800,000  Variable costs. . . . . . . . . . . . . . . . . . . . .  . 362,500  Fixed Operating costs. . . . .. . . . . . . . . .  . 187,500  Income tax rate . . . . . . . . . . . . . . .      30%  Dividend growth rate . . . . . . . . . . . . . . . .       2%    Required:  Compute the following:  Net Income available to Common  DOL  DFL  DTL

Corporate Fin Focused Approach
Corporate Fin Focused Approach
5th Edition
ISBN:9781285660516
Author:EHRHARDT
Publisher:EHRHARDT
Chapter14: Distributions To Shareholders: Dividends And Repurchases
Section: Chapter Questions
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Question

Assume the capital structure of XYZ Company: 

 

Bonds payable, 10% . . . . . . . 500,000 

Preferred stock, 8%, P100 par . . . . . . . .  100,000 

Common stock, 100,000 shares. . . . . . .  400,000 

 

Other data shows as follows: 

 

Sales. . . . . . . . . . . . . . . . . . . . . . . . . . . .  800,000 

Variable costs. . . . . . . . . . . . . . . . . . . . .  . 362,500 

Fixed Operating costs. . . . .. . . . . . . . . .  . 187,500 

Income tax rate . . . . . . . . . . . . . . .      30% 

Dividend growth rate . . . . . . . . . . . . . . . .       2% 

 

Required:  Compute the following: 

  1. Net Income available to Common 
  2. DOL 
  3. DFL 
  4. DTL 

 

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