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The charter of a corporation provides for the issuance of 93,872 shares of common stock. Assume that 44,236 shares were originally ssued and 3,223 were subsequently reacquired. What is the amount of cash dividends to be paid if a $2-per-share dividend is declared? a. $3,223 b. $93,872 c. $44,236 Od. $82,026

The charter of a corporation provides for the issuance of 93,872 shares of common stock. Assume that 44,236 shares were originally ssued and 3,223 were subsequently reacquired. What is the amount of cash dividends to be paid if a $2-per-share dividend is declared? a. $3,223 b. $93,872 c. $44,236 Od. $82,026

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The charter of a corporation provides for the issuance of 93,872 shares of common stock. Assume that 44,236 shares were originally issued and 3,223 were subsequently reacquired. What is the amount of cash dividends to be paid if a $2-per-share dividend is declared? - a. $3,223 - b. $93,872 - c. $44,236 - d. $82,026 **Explanation**: To calculate the cash dividends to be paid, we first determine the number of shares eligible for dividends. This is done by subtracting the number of reacquired shares from the originally issued shares: Original Shares Issued: 44,236 Reacquired Shares: 3,223 Eligible Shares for Dividends = Original Shares Issued - Reacquired Shares Eligible Shares = 44,236 - 3,223 Eligible Shares = 41,013 The dividend is $2 per share, so the total amount of dividends to be paid is: Total Dividends = Eligible Shares × Dividend per Share Total Dividends = 41,013 × $2 Total Dividends = $82,026 Therefore, the correct answer is d. $82,026.
Transcribed Image Text:The charter of a corporation provides for the issuance of 93,872 shares of common stock. Assume that 44,236 shares were originally issued and 3,223 were subsequently reacquired. What is the amount of cash dividends to be paid if a $2-per-share dividend is declared? - a. $3,223 - b. $93,872 - c. $44,236 - d. $82,026 **Explanation**: To calculate the cash dividends to be paid, we first determine the number of shares eligible for dividends. This is done by subtracting the number of reacquired shares from the originally issued shares: Original Shares Issued: 44,236 Reacquired Shares: 3,223 Eligible Shares for Dividends = Original Shares Issued - Reacquired Shares Eligible Shares = 44,236 - 3,223 Eligible Shares = 41,013 The dividend is $2 per share, so the total amount of dividends to be paid is: Total Dividends = Eligible Shares × Dividend per Share Total Dividends = 41,013 × $2 Total Dividends = $82,026 Therefore, the correct answer is d. $82,026.
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