Question

unition Help on w $100,000, when holders from this periods P14-4 (similar to) Dividend constrate The How Company's Mo d erquity count is as follows: The warnings available for common induded as part of the 123 million retained earrings What the maximum dicend per share that the an payt (Assume that legal capital includes all paid in capital.) b. If the firm has $150,000 in cash, what is the largest per share dividend can pay without borrowing? Indicate the accounts and changes any that will result of the firm pays the dividends indicated in parts and be d. Indicate the effects of an 50.000 cash dividend on stockholders' equity a. The maximum dividend per share that the firm cani (Round to the nearest cent.) 10 Data Table Common stock 400 000 shares at 54 par) Paid in capital in excess of pa Retained earnings Total stockholders' equity Print Done Enter your answer in the answer box and then click 7 parts remaining

can someone please help me with this question!?

Answer 1

a) maximum dividend per share = retained earning/No of outstanding common stock

maximum dividend per share = 2300000/400000 = 5.75

b) largest per share dividend = cash available/no of outstanding common stock

largest per share dividend = 150000/400000 = 0.375

c) in transaction (a) retained earning & cash will reduce by $2300000

in transaction (b) retained earning & cash will reduce by 150000

d) cash dividend of $80000, result retained earning will reduced by 80000

Retained earning (2300000-80000) = 2220000

total stockholder equity = 7820000