Finance 1200 Chapter 14 Homework
1. Calculating Dividend Amounts. Betty and John Martinez own 220 shares of ExxonMobil common
stock. ExxonMobil’s quarterly dividend is $1.76 per share. What is the amount of the dividend check
that the Martinez couple will receive for this quarter?
2. Determining the Number of Shares after a Stock Split. In March, stockholders of Dress Barn Corporation
approved a two for one stock split. After the split, how many shares of Dress Barn stock will an investor
have if she or he owned 210 shares before the split?
3. Calculating Total Return. Tammy Jackson purchased 100 shares of All-American Manufacturing
Company stock at $31.50 a share. One year later, she sold the stock for $38 a share. She paid her broker
a $28 commission when she purchased the stock and a $42 commission when she sold it. During the
12 months that she owned the stock, she received $160 in dividends. Calculate Ms. Jackson’s total
return on this investment.
4. Calculating Earnings Per Share, Price-Earnings Ratio, and Book Value. As a stockholder in Bozo Oil
Company, you receive its annual report. In the financial statements, the firm has reported assets of $9
million, liabilities of $5 million, after-tax earnings of $2 million, and 750,000 outstanding shares of
common stock.
a. Calculate the earnings per share of Bozo Oil’s common stock.
b. Assuming that a share of Bozo Oil’s common stock has a market value of $40, what is the firm’s
price-earnings ratio? (p. 457)
c. Calculate the book value of a share of Bozo Oil’s common stock.