Question
Chicago Company reported the following information at the end of the current year: Common stock ( $5 par value; 47,000 shares outstanding) $ 235,000 Preferred
Chicago Company reported the following information at the end of the current year:
Common stock ( $5 par value; 47,000 shares outstanding) | $ | 235,000 |
Preferred stock, 10% ( $10 par value; 9,400 shares outstanding) | 94,000 | |
Retained earnings | 288,000 | |
The board of directors is considering the distribution of a cash dividend to the two groups of stockholders. No dividends were declared during the previous two years. Assume the three cases below are independent of each other.
Case A: The preferred stock is noncumulative; the total amount of all dividends is $38,000.
Case B: The preferred stock is cumulative; the total amount of all dividends is $28,200.
Case C: The preferred stock is cumulative; the total amount of all dividends is $91,400 .
Required:
1. Assume Chicago Company issued a 30 percent common stock dividend on the outstanding shares when the market value per share was $24. Fill in the table below to show how this stock dividend would compare to Case C. (Leave no cells blank - be certain to enter "0" wherever required. Assets ,Liabilities, Stockholders Equity
m. Chicago Company reported the following information at the end of the current year: 2.5 points Common stock ($5 par value; 47,000 shares outstanding) Preferred stock, 10% ($10 par value; 9,400 shares outstanding) Retained earnings $235,000 94,000 288,000 ( 8 03:55:51 The board of directors is considering the distribution of a cash dividend to the two groups of stockholders. No dividends were declared during the previous two years. Assume the three cases below are independent of each other. eBook Case A: The preferred stock is noncumulative; the total amount of all dividends is $38,000. Case B: The preferred stock is cumulative; the total amount of all dividends is $28,200. Case C. The preferred stock is cumulative; the total amount of all dividends is $91,400 Print o Required: 1. Compute the amount of dividends, in total and per share, that would be payable to each class of stockholders for each case. (Round "Dividends per Share" to 2 decimal places.) References Complete this question by entering your answers in the tabs below. Required 1 Required 2 Assume Chicago Company issued a 30 percent common stock dividend on the outstanding shares when the market value per share was $24. Fill in the table below to show how this stock dividend would compare to Case C. (Leave no cells blank - be certain to enter "0" wherever required.) AMOUNT OF DOLLAR INCREASE (DECREASE) Cash Dividend-Case C Stock Dividend Item Assets Liabilities Stockholders' equityStep by Step Solution
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