Cash versus stock dividend Milwaukee Tool has the following stockholders' equity account. The firm's common stock currently sells for $3.88 per share. Preferred stock $ 100,000 Common stock (400,000 shares at $1.09 par) 436,000 Pald-in capital in excess of par 213,000 Retained earnings 400,000 Total stockholders' equity $1,149,000 a. Show the effects on the firm of a cash dividend of $0.10 per share. b. Show the effects on the form of a 5% stock dividend. c. Compare the effects in parts a and b. What are the significant differences between the two methods of paying dividends