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Posted by: Annie kavitha
Price Quoted by Student: $2.5
Posted On: 2011-04-05 05:05:39
 
Question

Your corporation has the following stockholders equity.

 

Common Stock at par                       $    750,000

Paid in capital in excess of par            1,250,000

Retained earnings                                2,500,000

Total                                                   $ 4,500,000

 

a. What is the maximum amount of dividends the corporation can pay in states where the firm’s legal capital is defined as the par value of its common stock?

      b. How does your answer change if the firm is in a state where legal capital includes all paid-in capital?


Solutions
a. What is the maximum amount of dividends the cor
Price $2.5
Attachment 1: Your corporation has the following.doc
Solution Posted By: Annie kavitha    Posted on: 05-04-2011