Reference no: EM132601733
Milwaukee Tool has the following stockholders' equity account. The firm's common stock currently sells for $4 per share.
Preferred stock ......................................$ 100,000
Common stock (400,000 shares at $1 par) .........400,000
Paid-in capital in excess of par .....................200,000
Retained earnings ....................................320,000
Total stockholders' equity .......................$1,020,000
a. Show the effects on the firm of a cash dividend of $0.01, $0.05, $0.10, and $0.20 per share.
b. Show the effects on the firm of a 1%, 5%, 10%, and 20% stock dividend.
c. Compare the effects in parts a and b. What are the significant differences between the two methods of paying dividends? Personal Finance P..>@$1.00 par)