Corporate finance is the area of finance dealing with monetary decisions that business enterprises make and the tools and analysis used to make these decisions. The primary goal of corporate finance is to maximize shareholder value. Although it is in principle different from managerial finance which studies the financial decisions of all firms, rather than corporations alone, the main concepts in the study of corporate finance are applicable to the financial problems of all kinds of firms.
Public finance is the study of the role of the government in the economy.
Kavungya answered the question on May 6, 2022 at 06:19
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Name and briefly describe three functions of public finance in a country's economy.
(Solved)
Name and briefly describe three functions of public finance in a country's economy.
Date posted:
May 6, 2022
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Answers (1)
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Highlight three ways in which a government could enhance revenue collection in a country
(Solved)
Highlight three ways in which a government could enhance revenue collection in a country
Date posted:
May 6, 2022
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Answers (1)
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Highlight the main differences between the public sector and the private sector from the point of view of financial management.
(Solved)
Highlight the main differences between the public sector and the private sector from the point of view of financial management.
Date posted:
May 6, 2022
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Answers (1)
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Explain four effects on the economy of your country arising from the loss of value of the national currency against the dollar.
(Solved)
Explain four effects on the economy of your country arising from the loss of value of the national currency against the dollar.
Date posted:
May 6, 2022
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Answers (1)
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Explain six disadvantages of using foreign debt as a source of finance to the government of your country.
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Explain six disadvantages of using foreign debt as a source of finance to the government of your country.
Date posted:
May 6, 2022
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Highlight six ways through which performance contracts have helped to restore trust and improved financial management in government departments.
(Solved)
Highlight six ways through which performance contracts have helped to restore trust and improved financial management in government departments.
Date posted:
May 6, 2022
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Answers (1)
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Discuss three forms of corporate restructuring that may be adopted by public enterprises.
(Solved)
Discuss three forms of corporate restructuring that may be adopted by public enterprises.
Date posted:
May 6, 2022
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Answers (1)
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Explain the concept of public enterprise restructuring.
(Solved)
Explain the concept of public enterprise restructuring.
Date posted:
May 6, 2022
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Answers (1)
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The following is the summarized Balance sheet of Kaka Kuona Ltd. as at 30 November 2003:
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The following is the summarized Balance sheet of Kaka Kuona Ltd. as at 30 November 2003:
Additional Information:
1. In the past Kaka Kuona ltd.’s earnings per share (EPS) averaged Sh.6 and the dividend payout
rate was 50% or Sh.3 per share. For the year ended 30 November 2003, the EPS declined to
Sh.2.50. Because it was felt that this decline was temporary, the annual dividend of Sh.3 per share
was maintained for the financial year ended 30 November 2003. As well as for the first six
months of the financial year ending 30 November 2004
2. Recent projections however have caused management to revise downwards the expected EPS. For
the financial ending 30 November 2004, the forecast of EPS has been reduced to Sh.2 per share
and for the financial year ending 30 November 2004, the forecast of EPS has been reduced to
Sh.2 per share and for the financial year ending 30 November 2005, adjusted to Sh2.20
3. Kaka Kuona Ltd. ‘s ordinary shares are currently selling in the market at Ss. 15 per share
The management of Kaka Kuona Ltd. is considering whether or not to retain the cash dividend of
Sh.3 per share for the next two financial years
Required:
a) Calculations to help determine whether it will be feasible to maintain dividends at Sh.3 Per share
for the next two financial years
b) Determine whether the company should replace the cash dividend with a bonus issue of one share
for every four ordinary shares
c) Explain the course of action that the management of Kaka Kuona Ltd should take in the light of
the declining projections in dividend payouts.
Date posted:
May 5, 2022
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Answers (1)
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Jambo Kenya Ltd. Has followed a policy of paying out a gradually increasing dividend per share over the past five years as shown below:
(Solved)
Jambo Kenya Ltd. Has followed a policy of paying out a gradually increasing dividend per share over the past five years as shown below:
Date posted:
May 5, 2022
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Answers (1)
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Explain the factors that influence the dividend policy
(Solved)
Explain the factors that influence the dividend policy
Date posted:
May 5, 2022
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Answers (1)
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Outline the reasons that may constrain a company from paying dividends to its shareholders at the end of a financial year.
(Solved)
Outline the reasons that may constrain a company from paying dividends to its shareholders at the end of a financial year.
Date posted:
May 5, 2022
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Answers (1)
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PDS Ltd is a medium sized company quoted on the stock exchange. The company’s year-end is 31 December. The following data relate to the company’s...
(Solved)
PDS Ltd is a medium sized company quoted on the stock exchange. The company’s year-end is 31 December. The following data relate to the company’s earnings per share (EPS) and dividend per share (DPS) for the last five years.
If the current dividend policy is maintained, the directors of PDS Ltd. expect that annual growth in earnings and dividend will be the same as the average growth in earnings over the past four years. PDS Ltd., which is wholly equity financed, is reluctant to obtain debt to finance its growth opportunities. The company is therefore considering a change in its dividend policy where 50% of its earnings will be retained to finance identified projects which are estimated to have an average post-tax
return of 15%.
The company's cost of capital is 12%.
Required;-
The share price of the company which might be expected by the market
(i) If the company does not announce the change of dividend policy.
(ii) If the company announces the change of dividend policy.
Date posted:
May 5, 2022
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Answers (1)
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Explain the arguments in favour of a stable dividend policy.
(Solved)
Explain the arguments in favour of a stable dividend policy.
Date posted:
May 5, 2022
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Answers (1)
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MCC Enterprises Ltd. expects its earnings before interest and taxes (EBIT) to fluctuate with the economic environment as shown below. You are advised that the...
(Solved)
MCC Enterprises Ltd. expects its earnings before interest and taxes (EBIT) to fluctuate with the economic environment as shown below. You are advised that the earnings distribution is expected to continue in perpetuity. The company has one million shares outstanding and no debt in the capital structure. The company pays all its earnings in dividends and shareholders require a
12% return. The company pays no taxes.
Date posted:
May 5, 2022
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Answers (1)
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Explain three ways in which a company could pay dividends to its shareholders.
(Solved)
Explain three ways in which a company could pay dividends to its shareholders.
Date posted:
May 5, 2022
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Answers (1)
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Enumerate four ways in which the dividend decision affects the wealth maximization goal of a company quoted in the securities exchange of your country.
(Solved)
Enumerate four ways in which the dividend decision affects the wealth maximization goal of a company quoted in the securities exchange of your country.
Date posted:
May 5, 2022
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Answers (1)
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Discuss the effect of the following concepts on the firm's dividend policy:
(i) Clientele effect
(ii) "Homemade" dividend.
(Solved)
Discuss the effect of the following concepts on the firm's dividend policy:
(i) Clientele effect
(ii) "Homemade" dividend.
Date posted:
May 5, 2022
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Answers (1)
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Nazitum Ltd. has current earnings per share of sh. 4.00. The company’s dividend for the previous year was sh. 1.50 per share and it has...
(Solved)
Nazitum Ltd. has current earnings per share of sh. 4.00. The company’s dividend for the previous year was sh. 1.50 per share and it has a target payout ratio of 0.60. The management of the company adjusts its dividend over two years.
Required:
The dividend per share for the current year.
Date posted:
May 5, 2022
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Answers (1)
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Davirex Ltd’s share has a nominal value of sh. 80. The company pays 10% of the nominal value of the share as dividend for the...
(Solved)
Davirex Ltd’s share has a nominal value of sh. 80. The company pays 10% of the nominal value of the share as dividend for the year. The current market price of the share is sh. 160 with 15% earnings yield.
Required:
i. Earnings per share.
ii. Dividend cover.
iii. Price – earnings ratio.
Date posted:
May 5, 2022
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Answers (1)