Bakersfield Industries Has a Market Value Equal to Its Book

question 3

Multiple Choice

Bakersfield Industries has a market value equal to its book value. Currently, the firm has excess cash of $750 and other assets of $19,400. Equity is worth $11,500. Bakersfield has 450 shares of stock outstanding and net income of $630. The firm has decided to pay out all of its excess cash as a cash dividend. What will the earnings per share be after the dividend is paid?

• A) -$.27
• B) $0.00
• C) $.73
• D) $1.01
• E) $1.40

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Definitions:

Nanogram

A unit of mass equal to one billionth of a gram.

Religion Conflict

Disputes and tensions that arise due to differences in religious beliefs and practices.

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Same Reality

The concept that different individuals or groups perceive the world around them in a similar way, sharing a common understanding or experience.