The Expected Dividend Is $2

question 39

Multiple Choice

The expected dividend is $2.50 for a share of stock priced at $25.What is the cost of common equity if the long-term growth in dividends is projected to be 8%?

• A)10%
• B)8%
• C)25%
• D)18%

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Definitions:

Transferred Out

In accounting, it refers to the cost of goods or inventory that has been moved from one production process or department to another in the course of manufacturing.

Weighted-Average Method

A method for computing the cost of goods sold and the remaining inventory value that uses the mean cost of all available units.

Process Costing System

An accounting system used for homogenous products that are mass-produced, assigning costs to units of product based on the process they go through.

Equivalent Units

A concept in cost accounting used to allocate costs to partially completed goods, expressing the work done in terms of fully completed goods.