1. From the statement of changes in equity, find the amount of dividends declared in each of fiscal 2019 and 2018.

1. What % of the companys net income is declared as a dividend in each of fiscal 2019 and 2018? Is the % consistent over the two years?
2. Explain how the payment of a dividend impacts each of i) the shareholders and ii) the company.
3. Were the dividends declared in each of fiscal 2019 and 2018 fully paid in cash to investors each year? Can we determine this from the financial statements?
4. It looks like instead of retained earnings, Cineplex has a deficit. What is a deficit? Can you still issue dividends if you have a deficit?

Cineplex Inc. Consolidated Statements of Changes in Equity For the years ended December 31, 2019 and 2018 (expressed in thousands of Canadian dollars) Share capital Contributed surplus Hedging reserves and other Cumulative translation adjustment Non- controlling interests Deficit Total January 1, 2019 S 852,379 $ 7,815 $ (3,678) $ 2,301 S (179,721) (85) $ 679,011 28,915 (24) 28,891 Net income Other comprehensive loss (page 4) Total comprehensive income 3,547 (3,188) (772) (413) 3,547 (3,188) 28,143 (24) 28,478 TI Dividends declared (112,732) (112,732) 1,607 1,607 Share option expense Conversion to cash- settled option plan (5,370) (5,370) December 31, 2019 $ 852,379 $ 4,052 $ (131) $ (887) S (264,310) $ (109) $ 590,994 January 1, 2018 S 856,761 $ 1,647 $ 1,332 $ (2,817) S (148,060) $ $ 708,863 77,053 (97) 76,956 (5,010) 5,118 217 325 (5,010) 5,118 77,270 (97) 77,281 (108,931) (108,931) Net income Other comprehensive income (page 4) Total comprehensive income Dividends declared Transfer on repayment of convertible debentures Share option expense Issuance of shares on exercise of options TGLP non-controlling interests recognized on formation (4,471) 4,471 1,718 IL | 1,718 89 (21) 68 12 12 December 31, 2018 $ 852,379 $ 7,815 $ (3,678) $ 2,301 S (179,721) S (85) $ 679,011