Author Question: Acme Explosives Inc. is an international producer of creative demolition products. Acme is all ... (Read 84 times)

nelaaney · **on:** Apr 25, 2021

Acme Explosives Inc. is an international producer of creative demolition products. Acme is all equity financed. Acme has too much cash, which it wants to distribute to its shareholders. Selected financial information for Acme is provided in the table. David Wylie is a director at Acme. Next Friday the board is meeting to vote on the format of the distribution. There are three choices on the ballot: 1) an extra dividend of $4 per share; 2) a stock dividend of 0.5 shares for each existing share; or 3) an open market stock repurchase to buy 28.5% of shares outstanding at a price of $14.04. As part of his compensation package, David has options to purchase one million shares at a price of $12 per share. If David's sole concern is his own wealth, then how should he vote at the board meeting?

Selected Financial Information

for Acme Corporation

Cash	$12,600M
Market Capitalization	$44,226M
Shares Outstanding	3,150M
Stock Price	$14.04
Debt	$0

◦ Extra Dividend
◦ Stock Repurchase
◦ Stock Dividend

JYan · **Reply #1 on:** Apr 25, 2021

A FREE account is required to view all solutions!

Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.

Answer Preview

Only 25% of students answer this correctly