Reference no: EM132574814
Question - Walker Inc. has the following capital structure
Preferred Stock: $25 par value, 10,000 shares authorized $180,000
Common Stock: $10 Par value, 100,000 shares authorized $900,000
Total Paid in capital $1,080,000
Retained Earnings $550,000
Total Stock holders' equity $1,630,000
The number of issued and outstanding shares of both preferred and common stock have been the same for last two years. Dividends on preferred stock are 8 percent of par value and have been paid each year the stock was outstanding except for the immediate past year. In the current year the Management declares a dividend of $60,000.
Required -
a. How many shares of preferred stock and common stock have been issued?
b. Indicate the amount of dividends that will be paid to both common and preferred stockholders assuming
i. Preferred stock is cumulative
ii. Preferred stock is non-cumulative
c. What was the average issuance price per share of common stock?
d. What is the amount of legal capital and paid-in capital?