罗斯公司理财题库全集(共35页).doc

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1、精选优质文档-倾情为你奉上Chapter 19 Dividends and Other Payouts Answer Key Multiple Choice Questions1.Payments made out of a firms earnings to its owners in the form of cash or stock are called:A.dividends.B.distributions.C.share repurchases.D.payments-in-kind.E.stock splits.Difficulty level: EasyTopic: DIVIDEN

2、DSType: DEFINITIONS2.Payments made by a firm to its owners from sources other than current or accumulated earnings are called:A.dividends.B.distributions.C.share repurchases.D.payments-in-kind.E.stock splits.Difficulty level: EasyTopic: DISTRIBUTIONSType: DEFINITIONS3.A cash payment made by a firm t

3、o its owners in the normal course of business is called a:A.share repurchase.B.liquidating dividend.C.regular cash dividend.D.special dividend.E.extra cash dividend.Difficulty level: EasyTopic: REGULAR CASH DIVIDENDSType: DEFINITIONS4.A cash payment made by a firm to its owners when some of the firm

4、s assets are sold off is called a:A.liquidating dividend.B.regular cash dividend.C.special dividend.D.extra cash dividend.E.share repurchase.Difficulty level: EasyTopic: LIQUIDATING DIVIDENDSType: DEFINITIONS5.The date on which the board of directors passes a resolution authorizing payment of a divi

5、dend to the shareholders is the _ date.A.ex-rightsB.ex-dividendC.recordD.paymentE.declarationDifficulty level: EasyTopic: DECLARATION DATEType: DEFINITIONS6.The date before which a new purchaser of stock is entitled to receive a declared dividend, but on or after which she does not receive the divid

6、end, is called the _ date.A.ex-rightsB.ex-dividendC.recordD.paymentE.declarationDifficulty level: EasyTopic: EX-DIVIDEND DATEType: DEFINITIONS7.The date by which a stockholder must be registered on the firms roll as having share ownership in order to receive a declared dividend is called the:A.ex-ri

7、ghts date.B.ex-dividend date.C.date of record.D.date of payment.E.declaration date.Difficulty level: EasyTopic: DATE OF RECORDType: DEFINITIONS8.The date on which the firm mails out its declared dividends is called the:A.ex-rights date.B.ex-dividend date.C.date of record.D.date of payment.E.declarat

8、ion date.Difficulty level: EasyTopic: DATE OF PAYMENTType: DEFINITIONS9.The ability of shareholders to undo the dividend policy of the firm and create an alternative dividend payment policy via reinvesting dividends or selling shares of stock is called (a):A.perfect foresight model.B.MM Proposition

9、I.C.capital structure irrelevancy.D.homemade leverage.E.homemade dividends.Difficulty level: MediumTopic: HOMEMADE DIVIDENDSType: DEFINITIONS10.The markets reaction to the announcement of a change in the firms dividend payout is likely the:A.information content effect.B.clientele effect.C.efficient

10、markets hypothesis.D.MM Proposition I.E.MM Proposition II.Difficulty level: MediumTopic: INFORMATION CONTENT EFFECTType: DEFINITIONS11.The observed empirical fact that stocks attract particular investors based on the firms dividend policy and the resulting tax impact on investors is called the:A.inf

11、ormation content effect.B.clientele effect.C.efficient markets hypothesis.D.MM Proposition I.E.MM Proposition II.Difficulty level: EasyTopic: CLIENTELE EFFECTType: DEFINITIONS12.A _ is an alternative method to cash dividends which is used to pay out a firms earnings to shareholders.A.mergerB.acquisi

12、tionC.payment-in-kindD.stock splitE.share repurchaseDifficulty level: EasyTopic: SHARE REPURCHASEType: DEFINITIONS13.A payment made by a firm to its owners in the form of new shares of stock is called a _ dividend.A.stockB.normalC.specialD.extraE.liquidatingDifficulty level: EasyTopic: STOCK DIVIDEN

13、DSType: DEFINITIONS14.An increase in a firms number of shares outstanding without any change in owners equity is called a:A.special dividend.B.stock split.C.share repurchase.D.tender offer.E.liquidating dividend.Difficulty level: EasyTopic: STOCK SPLITSType: DEFINITIONS15.The difference between the

14、highest and lowest prices at which a stock has traded is called its:A.average price.B.bid-ask spread.C.trading range.D.opening price.E.closing price.Difficulty level: EasyTopic: TRADING RANGEType: DEFINITIONS16.In a reverse stock split:A.the number of shares outstanding increases and owners equity d

15、ecreases.B.the firm buys back existing shares of stock on the open market.C.the firm sells new shares of stock on the open market.D.the number of shares outstanding decreases but owners equity is unchanged.E.shareholders make a cash payment to the firm.Difficulty level: EasyTopic: REVERSE SPLITSType

16、: DEFINITIONS17.The last date on which you can purchase shares of stock and still receive the dividend is the date _ business day(s) prior to the date of record.A.zeroB.oneC.threeD.fiveE.sevenDifficulty level: EasyTopic: DIVIDEND PAYMENTSType: CONCEPTS18.Leslie purchased 100 shares of GT, Inc. stock

17、 on Wednesday, June 7th. Marti purchased 100 shares of GT, Inc. stock on Thursday, July 8th. GT declared a dividend on June 20th to shareholders of record on July 12th and payable on August 1st. Which one of the following statements concerning the dividend paid on August 1st is correct given this in

18、formation?A.Neither Leslie nor Marti are entitled to the dividend.B.Leslie is entitled to the dividend but Marti is not.C.Marti is entitled to the dividend but Leslie is not.D.Both Marti and Leslie are entitled to the dividend.E.Both Marti and Leslie are entitled to one-half of the dividend amount.D

19、ifficulty level: MediumTopic: DIVIDEND PAYMENTSType: CONCEPTS19.All else equal, the market value of a stock will tend to decrease by roughly the amount of the dividend on the:A.dividend declaration date.B.ex-dividend date.C.date of record.D.date of payment.E.day after the date of payment.Difficulty

20、level: MediumTopic: DIVIDEND PAYMENTSType: CONCEPTS20.Which one of the following is an argument in favor of a low dividend policy?A.the tax on capital gains is deferred until the gain is realizedB.few, if any, positive net present value projects are available to the firmC.a preponderance of stockhol

21、ders have minimal taxable incomeD.a majority of stockholders have other investment opportunities that offer higher rewards with similar risk characteristicsE.corporate tax rates exceed personal tax ratesDifficulty level: MediumTopic: FACTORS FOR LOW DIVIDENDSType: CONCEPTS21.The fact that flotation

22、costs can be significant is justification for:A.a firm to issue larger dividends than its closest competitors.B.a firm to maintain a constant dividend policy even if it frequently has to issue new shares of stock to do so.C.maintaining a constant dividend policy even when profits decline significant

23、ly.D.maintaining a high dividend policy.E.maintaining a low dividend policy and rarely issuing extra dividends.Difficulty level: MediumTopic: FACTORS FOR LOW DIVIDENDSType: CONCEPTS22.Which of the following may tend to keep dividends low?I. a state law restricting dividends in excess of retained ear

24、ningsII. a term contained in bond indenture agreementsIII. the desire to maintain constant dividends over timeIV. flotation costsA.II and III onlyB.I and IV onlyC.II, III, and IV onlyD.I, II, and III onlyE.I, II, III, and IVDifficulty level: MediumTopic: FACTORS FOR LOW DIVIDENDSType: CONCEPTS23.Ign

25、oring capital gains as an alternative, the tax law changes in 2003 tend to favor a:A.lower dividend policy.B.constant dividend policy.C.zero-dividend policy.D.higher dividend policy.E.restrictive dividend policy.Difficulty level: EasyTopic: FACTORS FOR HIGH DIVIDENDSType: CONCEPTS24.Which of the fol

26、lowing are factors that favor a high dividend policy?I. stockholders desire for current incomeII. tendency for higher stock prices for high dividend paying firmsIII. investor dislike of uncertaintyIV. high percentage of tax-exempt institutional stockholdersA.I and III onlyB.II and IV onlyC.I, III, a

27、nd IV onlyD.II, III, and IV onlyE.I, II, III, and IVDifficulty level: MediumTopic: FACTORS FOR HIGH DIVIDENDSType: CONCEPTS25.An investor is more likely to prefer a high dividend payout if a firm:A.has high flotation costs.B.has few, if any, positive net present value projects.C.has lower tax rates

28、than the investor.D.has a stock price that is increasing rapidly.E.offers high capital gains which are taxed at a favorable rate.Difficulty level: EasyTopic: FACTORS FOR HIGH DIVIDENDSType: CONCEPTS26.The information content of a dividend increase generally signals that:A.the firm has a one-time sur

29、plus of cash.B.the firm has few, if any, net present value projects to pursue.C.management believes that the future earnings of the firm will be strong.D.the firm has more cash than it needs due to sales declines.E.future dividends will be lower.Difficulty level: MediumTopic: INFORMATION CONTENTType

30、: CONCEPTS27.Of the following factors, which one is considered to be the primary factor affecting a firms dividend decision?A.personal taxes of company stockholdersB.consistent dividend policyC.attracting retail investorsD.attracting institutional investorsE.sustainable changes in earningsDifficulty

31、 level: MediumTopic: DIVIDEND SURVEY RESULTSType: CONCEPTS28.Financial managers:A.are reluctant to cut dividends.B.tend to ignore past dividend policies.C.tend to prefer cutting dividends every time quarterly earnings decline.D.prefer cutting dividends over incurring flotation costs.E.place little e

32、mphasis on dividend policy consistency.Difficulty level: EasyTopic: DIVIDEND SURVEY RESULTSType: CONCEPTS29.If you ignore taxes and transaction costs, a stock repurchase will:I. reduce the total assets of a firm.II. increase the earnings per share.III. reduce the PE ratio more than an equivalent sto

33、ck dividend.IV. reduce the total equity of a firm.A.I and III onlyB.II and IV onlyC.I, II, and IV onlyD.I, III, and IV onlyE.I, II, III, and IVDifficulty level: MediumTopic: STOCK REPURCHASEType: CONCEPTS30.From a tax-paying investors point of view, a stock repurchase:A.is equivalent to a cash divid

34、end.B.is more desirable than a cash dividend.C.has the same tax effects as a cash dividend.D.is more highly taxed than a cash dividend.E.creates a tax liability even if the investor does not sell any of the shares he owns.Difficulty level: MediumTopic: STOCK REPURCHASEType: CONCEPTS31.All else equal

35、, a stock dividend will _ the number of shares outstanding and _ the value per share.A.increase; increaseB.increase; decreaseC.not change; increaseD.decrease; increaseE.decrease; decreaseDifficulty level: EasyTopic: STOCK DIVIDENDSType: CONCEPTS32.A small stock dividend is defined as a stock dividen

36、d of less than _%.A.10 to 15B.15 to 20C.20 to 25D.25 to 30E.30 to 35Difficulty level: EasyTopic: STOCK DIVIDENDSType: CONCEPTS33.Nu Tech, Inc. is a technology firm with good growth prospects. The firm wishes to do something to acknowledge the loyalty of its shareholders but needs all of its availabl

37、e cash to fund its rapid growth. The market price of its stock is currently trading in the middle of its preferred trading range. The firm could consider:A.issuing a liquidating dividend.B.a stock split.C.a reverse stock split.D.issuing a stock dividend.E.a special cash dividend.Difficulty level: Me

38、diumTopic: STOCK DIVIDENDType: CONCEPTS34.Which of the following are valid reasons for a firm to reduce or eliminate its cash dividends?I. The firm is on the verge of violating a bond restriction which requires a current ratio of 1.8 or higher.II. A firm has just received a patent on a new product f

39、or which there is strong market demand and it needs the funds to bring the product to the marketplace.III. The firm can raise new capital easily at a very low cost.IV. The tax laws have recently changed such that dividends are taxed at an investors marginal rate while capital gains are tax exempt.A.

40、I and III onlyB.II and IV onlyC.II, III, and IV onlyD.I, II, and IV onlyE.I, II, III, and IVDifficulty level: MediumTopic: STOCK DIVIDENDSType: CONCEPTS35.A stock split:A.increases the total value of the common stock account.B.decreases the value of the retained earnings account.C.does not affect th

41、e total value of any of the equity accounts.D.increases the value of the capital in excess of par account.E.decreases the total owners equity on the balance sheet.Difficulty level: MediumTopic: STOCK SPLITSType: CONCEPTS36.Stock splits are often used to:A.adjust the market price of a stock such that

42、 it falls within a preferred trading range.B.decrease the excess cash held by a firm.C.increase both the number of shares outstanding and the market price per share simultaneously.D.increase the total equity of a firm.E.adjust the debt-equity ratio such that it falls within a preferred range.Difficu

43、lty level: EasyTopic: STOCK SPLITSType: CONCEPTS37.Which of the following tend to increase the appeal of a firms stock to the average investor?I. a cessation of dividends by a firm which has a long history of increasing dividendsII. the distribution of a special dividend by a dividend-paying firmIII

44、. a reverse stock split for a low-priced stockIV. the declaration of a stock dividend by a growth firmA.I and III onlyB.II and IV onlyC.I, II, and IV onlyD.II, III, and IV onlyE.I, II, III, and IVDifficulty level: MediumTopic: STOCK SPLITSType: CONCEPTS38.Wydex, Inc. stock is currently trading at $8

45、2 a share. The firm feels that its primary clientele can afford to spend between $2,000 and $2,500 to purchase a round lot of 100 shares. The firm should consider a:A.reverse stock split.B.liquidating dividend.C.stock dividend.D.stock split.E.special dividend.Difficulty level: MediumTopic: STOCK SPL

46、ITType: CONCEPTS39.A one-for-four reverse stock split will:A.increase the par value by 25%.B.increase the number of shares outstanding by 400%.C.increase the market value but not affect the par value per share.D.increase a $1 par value to $4.E.increase a $1 par value by $4.Difficulty level: MediumTopic: REVERSE STOCK SPLITSType: CONCEPTS40.A reverse stock split is sometimes used as a means of:A.decreasing the liquidity of a stock.B.decreasing the market value per shar