The Sailors Co

The Sailors Co. is paying a $2.00 per share dividend today. There are 200,000 shares outstanding with market price of $32 per share. Before the dividend, the company had earnings per share of
$2) 50. As a result of this dividend, the:

A) Retained earnings will decrease by $200,000.
B) Retained earnings will increase by $320,000.
C) Total firm value will not change.
D) Earnings per share will increase to $3.00.
E) Price-earnings ratio will be 12.