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please solve requirement 1, show all calculation, Thank you. Part C (23 marks) ABC Ltd. is considering one of three following courses of action: (1)
please solve requirement 1, show all calculation, Thank you.
Part C (23 marks) ABC Ltd. is considering one of three following courses of action: (1) declaring and paying a $0.50 cash dividend (2) declaring and distributing a 5% stock dividend (3) declaring a 2-for-1 stock split The current share price is $14 per share. Required: 1. Help ABC Ltd. make its decision by filling in the total dollar amounts in the following chart. Treat each possibility independently. (21 marks) Before action Total assets Total liabilities Common shares Retained earnings Total $1,250,000 $ 250,000 equity Number of common shares 600,000 400,000 1,000,000 shareholders' equity Total liabilities & $1,250,000 shareholders' 100,000 (1) After Cash dividend (2) After stock dividend (3) After stock split 2. Give one reason why (i) a company would declare a stock split and (i) pay a stock dividend. (2 marks) Step by Step Solution
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