Chicago Company reported the following information at the end of the current year:Common stock ($10 par value; 48,000 shares outstanding)Preferred stock, 15% ($15 par value; 9,500 shares outstanding)Retained earningsThe board of directors is considering the distribution of a cash dividend to the two groups of stockholders. No dividends weredeclared during the previous two years. Assume the three cases below are independent of each other.Case A: The preferred stock is noncumulative; the total amount of all dividends is $38,500.Case B: The preferred stock is cumulative; the total amount of all dividends is $64,125.Case C: The preferred stock is cumulative; the total amount of all dividends is $91,500.Required:1. Compute the amount of dividends, in total and per share, that would be payable to each class of stockholders for each case.2. Assume Chicago Company issued a 15 percent common stock dividend on the outstanding shares when the market value pershare was $39. Fill in the table below to show how the stock dividend and Case C would affect Total Assets, Liabilities, andStockholders' equityComplete this question by entering your answers in the tabs below.Required 1 Required 2Compute the amount of dividends, in total and per share, that would be payable to each class of stockholders for each case.Note: Round "Dividends per Share" to 2 decimal places.Case ACase BCase CPreferredStockDividendsCommonStock$ 480,000142,500288,500TotalDividends per SharePreferred CommonStockStockRequired 1Required 2 >< Prev7 of 8www--Nex> Chicago Company reported the following information at the end of the current year:Common stock ($10 par value; 48,000 shares outstanding)Preferred stock, 15% ($15 par value; 9,500 shares outstanding)Retained earningsThe board of directors is considering the distribution of a cash dividend to the two groups of stockholders. No dividends weredeclared during the previous two years. Assume the three cases below are independent of each other.Case A: The preferred stock is noncumulative; the total amount of all dividends is $38,500.Case B: The preferred stock is cumulative; the total amount of all dividends is $64,125.Case C: The preferred stock is cumulative; the total amount of all dividends is $91,500.Required:1. Compute the amount of dividends, in total and per share, that would be payable to each class of stockholders for each case.2. Assume Chicago Company issued a 15 percent common stock dividend on the outstanding shares when the market value pershare was $39. Fill in the table below to show how the stock dividend and Case C would affect Total Assets, Liabilities, andStockholders' equity.Complete this question by entering your answers in the tabs below.Required 2Assume Chicago Company issued a 15 percent common stock dividend on the outstanding shares when the market value pershare was $39. Fill in the table below to show how the stock dividend and Case C would affect Total Assets, Liabilities, andStockholders' equity.Note: Leave no cells blank - be certain to enter "0" wherever required.Required 1ItemTotal AssetsTotal LiabilitiesTotal Stockholders' equity$ 480,000142,500288,500AMOUNT OF DOLLAR INCREASE (DECREASE)Stock DividendCash Dividend-Case C< Required 1Required 2 >< Prev7 of 8Show less ANext >

Note: 1 ) Preference shareholders are eligible for the dividend to be paid first. 2 ) Cumulative…

Common stock ($10 par value; 48,000 shares outstanding) Preferred stock, 15% ($15 par value; 9,500 shares outstanding) Retained earnings The board of directors is considering the distribution of a cash dividend to the two groups of stockholders. No dividends were declared during the previous two years. Assume the three cases below are independent of each other. Case A: The preferred stock is noncumulative; the total amount of all dividends is $38,500. Case B: The preferred stock is cumulative; the total amount of all dividends is $64,125. Case C: The preferred stock is cumulative; the total amount of all dividends is $91,500. Required: 1. Compute the amount of dividends, in total and per share, that would be payable to each class of stockholders for each case. 2. Assume Chicago Company issued a 15 percent common stock dividend on the outstanding shares when the market value per share was $39. Fill in the table below to show how the stock dividend and Case C would affect Total Assets, Liabilities, and Stockholders' equity. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Compute the amount of dividends, in total and per share, that would be payable to each class of stockholders for each case. Note: Round "Dividends per Share" to 2 decimal places. Case A Case B Case C Preferred Stock Dividends Common Stock Total $ 480,000 142,500 288,500 Dividends per Share Common Stock Preferred Stock Required 1 Required 2 > < Prev 7 of 8 www E Nex>

14th Edition

ISBN:9781305088436

Author:Carl Warren, Jim Reeve, Jonathan Duchac

Publisher:Carl Warren, Jim Reeve, Jonathan Duchac

Chapter13: Corporations: Organization, Stock Transactions, And Dividends

Section: Chapter Questions

Problem 3PA: The following selected accounts appear in the ledger of EJ Construction Inc. at the beginning of the...