1. Augustus LTD currently has outstanding 20,000 no par value common shares with a carrying value of $200,000, and 10,000 no par value, $0.60, cumulative fully participating preferred shares with a carrying value of $100,000. Dividends on the preferred shares are one year in arrears. Assuming that Augustus wishes to distribute $54,000 in dividends, the common shareholders will receive:

1. $12,000
2. $22,000
3. $32,000
4. $42,000

1. During 2017, Cayden Corp. issued four hundred $1,000 bonds at 104. One detachable warrant, entitled the holder to purchase 15 of Caydens common shares, was attached to each bond. At the date of issuance, the market value of the bonds, without warrants, was 96. The market value of each warrant was $40. Using relative fair value method, what amount should Cayden credit to Bonds payable from the proceeds?

1. $416,000
2. $400,000
3. $399,360
4. $384,000