Calculate the proposed distribution of dividends in E13.15 assuming that the preferred stock is noncumulative. E13.15
The board of directors of Picasso Manufacturing, Inc., may declare a dividend this year but has not declared a dividend for the past two years. The corporation has 800,000 shares of $1 par value common stock authorized and 200,000 shares issued and outstanding. It also has 40,000 shares of 5 percent, $10 par value cumulative preferred stock authorized, of which 40,000 shares are issued and outstanding. Compute the amount of dividends available for common and preferred shareholders if the dividend declaration is $80,000.
Zulu Corporation has 5,000,000 shares of $0.03 par value common stock authorized, of which 750,000 shares were issued for $3,550,000 and are currently selling for $90 in the stock market. Zulu Corporation is considering a three-for-one stock split.
What will be the impact of the stock split on Zulu Corporation?