Question: 1. Peggy Grey's Cookies has net income of $300. The firm pays out 40 percent of the net income to its shareholders as dividends. During the year, the company sold $75 worth of common stock. What is the cash flow to stockholders?
2. A firm has sales of $4,840, costs of $2,640, interest paid of $179, and depreciation of $493. The tax rate is 34 percent. What is the value of the cash coverage ratio?