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Equity Portion of Balance Sheet

Common Stock 5,000,000 shares authorized, 1,500,000 issued $180,000

Capital in excess of par value $15,000,000

Treasury Stock on Common 30,000 shares $303,600

Cumulative Preferred Stock 2,000,000 shares authorized,

500,000 issued $2 Dividend $10 par, $5,000,000

Capital Surplus [Excess of paid in Capital] $12,500,000

Treasury Stock on Preferred Stock 25,000 shares $875,000

Retained Earnings $20,202,021

1. How is a $6,000,000 cash dividend to be split between preferred and common stockholders? Show Work
2. Suppose the company is 4 years behind in dividends what is the new split for the $6,000,000 dividend payment between preferred and common stockholders? Show work
3. How many common stock shares are outstanding?
4. What was the initial stock price per share of Common Stock?
5. What was the initial stock price per share of the Preferred Stock?
6. Using your answer to question one what is the payout rate per share for the preferred stock?
7. Using your answer to question one what is the payout rate per share for common stock?
8. If Slack company announces a 7 for 1 stock split of the cumulative preferred stock, then what is the impact on the balance sheet?
9. Could Slack issue a 3 to 1 stock split on common? Explain.
10. If Slack were to provide for a 12% common stock dividend, then how many new shares are to be issued to existing Slack shareholders?
11. Assume in question 10 above that the market price of common stock was $20 at the time of the dividend. What is the journal entry?
12. Using the equity statement above determine the total amount of cash dividends that Slack could pay out as still exist as a corporation?
13. What is Slacks total equity per the balance sheet listed above?