Dividend constraints A firm has $$850,000$ in paid$-$in capital, retained earnings of $$36,000($including the current year's

earnings$),$ and $25,000$ shares of common stock outstanding. In the current year, it has $$26,000$ of earnings.

a$.$ If legal capital is assumed to include all paid$-$in capital, the most the firm can pay in cash dividends on a per$-$share

basis is $$,.($Round to the nearest cent.$)$

b$.$ If the firm pays a cash dividend of $$0\mathrm{.}69$ per share, its cash will decrease by $$.($Round to the nearest dollar.$)$

If the firm pays a cash dividend of $$0\mathrm{.}69$ per share, its retained earnings will decrease by $

$($Round to the

nearest dollar.$)$

c$.$ If the firm cannot raise any new funds from external sources, which of the following accounts is the key constraint

with respect to the magnitude of the firm's dividend payments? $($Select the best answer below.$)$

A$.$ Retained earnings

B$.$ Paid$-$in capital

C$.$ Number of outstanding shares

D$.$ Cash