Mastery Problem: Corporations: Organization, Stock Transactions, and Dividends Pranks, Inc. Pranks, Inc. is a manufacturer of joke and novelty products for perpetrators of practical jokes. The corporation has paid several cash dividends throughout Year 6, the current year. It is also declaring a stock dividend to its stockholders as the calendar year-end approaches. You've been brought in as a consultant to assist with this process, and also to help determine whether some missing information can be determined before the distribution of the stock dividend is made. The company has two classes of stock: common stock and cumulative preferred stock. Number of common shares authorized Number of common shares issued i Par value of common shares Par value of cumulative preferred shares 800,000 650,000 $20 $30 $7,000,000 $0 Total retained earnings before the stock dividend is declared $33,500,000 Paid-in capital in excess of par-common stock Paid-in capital in excess of par-preferred stock No treasury share have been reissued. Preferred Dividends Common Dividends Total Cash Year Dividends Total Per Share Total Per Share Year 1 30,000 30,000 0.20 0 0.00 Year 2 54,000 54,000 0.36 0.00 Year 3 87,000 51,000 0.34 36,000 0.09 Year 4 105,000 45,000 0.3 60,000 0.15 Year 5 117,000 45,000 0.3 72,000 0.18 Year 6 165,000 45,000 0.3 120,000 0.3