Instructions – PLEASE READ THEM CAREFULLY
V The Assignment must be submitted only in WORD format .
V Students are advised to make their work clear and well presented. This also includes filling in your information on the cover page.
V Students must mention question numbers clearly in their answers
v Avoid plagiarism; the work should be in your own words; copying from students or other resources without proper referencing will result in ZERO marks. No exceptions.
v All answered must be typed using Times New Roman (size 12, double-spaced) font. No pictures containing text will be accepted and will be considered plagiarism).
Submissions without this cover page will NOT be accepted
(((ALL REFERENCES MUST BE IN APA STYLE))))
(((( please mention the formulas on each step you do while solving the questions))))))
Assignment Questions: (Marks: 05)
Q1. HBF company has 50,000 shares outstanding which worth $1 million in total. The Balance sheet of the company shows $250,000 of cash and $750,000 of other assets. If the company issues a $1- per share cash dividend, how is the shareholder wealth affected?
Q2. PPP company uses the percentage of sales model to expect sales. The company expects sales to increase by 5% annually over the next five years. If costs are proportional to sales at 70%, and last year’s sales were SAR 3,000, what is the projected net income in year 5?
Q3. What are the costs associated with holding excess cash? (1 Mark)