Fifteen years ago, Lenny purchased an insurance policy on his own life. The policy provides a $3 million death benefit. Lenny has paid $682,000 of premiums, and the cash surrender value of the policy is $725,000. He plans to liquidate the policy to generate cash for his business. If Lenny's marginal tax rate is 35%, how much after-tax cash will the liquidation generate?
A. $682,000
B. $725,000
C. $709,950
D. $471,250
Answer: C
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A) $45,000 B) $150,000 C) $22,500 D) $105,000
Seymore Corp. has the following number of shares of stock outstanding: Cumulative preferred stock, 8%, $100 par2,000shares Common stock, $12 par20,000shares Seymore will distribute $80,000 to the two classes of stockholders this year. Not counting the current year, the preferred stock dividends are one year in arrears. Indicate whether each of the following statements is true or false._____ a) Preferred stockholders will receive $16,000 of cash dividends in the current year._____ b) After all required preferred dividends are paid, preferred and common stockholders will share the remaining dividend._____ c) Common stockholders will receive $48,000 of cash dividend in the current year._____ d) The amount of common dividends per share that stockholders will receive in the current
year is $6.40._____ e) The amount of dividends in arrears is zero after the $80,000 of dividends have been paid. What will be an ideal response?
If the interest rate on foreign deposits increases, holding everything else constant,
A) the expected return on these deposits must also increase. B) the expected return on domestic deposits must decrease. C) the expected return on domestic deposits must increase. D) both A and B of the above. E) both A and C of the above.