Could someone answer the last 5? The answers to the first 5 are attached.
EQUITY PROBLEM [30 Points] Snow Inc. has the following items in its current balance sheet: Common Stock 10,000,000 shares authorized with 2,000,000 issued $6,000,000 $24,000,000 Capital Surplus $6,000,000 Treasury Stock on Common 100,000 shares Cumulative Preferred Stock 500,000 authorized [2%] $100 par $8,000,000 $6,000,000 Treasury Stock on Preferred Stock 10,000 shares Retained Earnings $60,000,000 1. Snow Inc. wishes to announce a total cash dividend of $40,000,000. How is this dividend to be split between the common and preferred stockholders? 2. What is the dividend per share for common and preferred after the dividend distribution from question 1 above? 3. Suppose Snow Inc. was three years in the arrears in paying dividends to the preferred stockholders, then what is the dollar amount of the preferred and common shareholder dividend? 4. How many Snow common stock shares are truly outstanding? 5. If Snow Inc. announces a 2 for 1 stock split of the cumulative preferred, then what is the new total number of shares outstanding after the preferred stock split? 6. If Snow Inc. were to provide for a 5% common stock dividend, then how many new shares are to be mailed to existing shareholders? 7. Assume in question [6] the market price of the common stock was $15 at the time of the stock dividend. Provide journal entry to record the stock dividend? 8. Using the equity portion of Snow Inc. balance sheet above, determine the amount of the total equity in Snow Inc. Assume this question ignores the results of questions [1-7] above. 9. What is the impact of the common and preferred cash dividend [$40,000,000 as per question 1 above] or the current balance sheet of Snow Inc.? 10. What is the impact of the 20% common stock dividend on the balance sheet? Assume this question ignores questions [1-9] above. Anonymous answered this 6o Was this answer helpful? 89 answers part 1 Rate answer here. Amount ($) cumulative preferred shares issued 8000000 less:treasury stock on preferred shares (10000*$100) 1000000 outstanding preferred shares 7000000 dividend rate on preferred shares 2% total dividend to preferred shares ($7000000*2%) 140000 total cash dividend paid (provided) 40000000 total dividend to common shares (total dividend paid less total dividend to preferred shares) 39860000 part 2 common preferred number of share issued 80000 2000000 less treasury shares (provided) -100000 -10000 number of shares outstanding 1900000 70000 dividends paid (in $) (calculated above) 39860000 140000 dividends per share (in $)(dividend paidumber of shares outstanding) 20.98 2.00 part 3 Amount ($) preferred dividend for one year (calculated in question 1) 140000 years in arrears 3 total preferred dividend in arrears (140000*3) 420000 add current year preferred dividend 140000 total dividend for preferred shares 560000 total dividend paid (given) 40000000 dividend for common share (total dividend paid less total dividend to preferred shares) 39440000 part 4 common number of common shares issued 2000000 -100000 less:treasury shares of common shares total number of commons shares outstanding 1900000 part 5 Stock split will increase the outstanding number of shares but at the same time will reduce the par value of shares accordingly. but the total value of preferred shares outstanding will be not be impacted. In the given question, the par value will decline 2 times from $100 per share to $50 per share. number of outstanding preferred shares before stock split 70000 stock split ratio 2 for 1 number of outstanding preferred shares after stock split (70000 shares *2) 140000 amount of preferred shares issued after stock split ($) 8000000 less:amount of treasury preferred shares ($) -1000000 $50) ($) amount of preferred shares outstanding after stock split (140000 shares 7000000 Comment >
