Question Details

Corporations generally issue stock dividends




1.	Marion, Inc. has 5,000 shares of 5%, $100 par value, noncumulative preferred stock and 20,000 shares of $1 par value common stock outstanding at December 31, 2013. There were no dividends declared in 2012. The board of directors declares and pays a $55,000 dividend in 2013. What is the amount of dividends received by the common stockholders in 2013?
a.	$0
b.	$25,000
c.	$55,000
d.	$30,000



	2.	Library, Inc. has 2,500 shares of 4%, $50 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2012, and December 31, 2013. The board of directors declared and paid a $4,000 dividend in 2012. In 2013, $15,000 of dividends are declared and paid. What are the dividends received by the preferred and common shareholders in 2013?
	Preferred	Common
a.	$9,000	$6,000
b.	$7,500	$7,500
c.	$6,000	$9,000
d.	$5,000	$10,000



	3.	Township, Inc. has 10,000 shares of 5%, $100 par value, noncumulative preferred stock and 100,000 shares of $1 par value common stock outstanding at December 31, 2012, and December 31, 2013. The board of directors declared and paid a $50,000 dividend in 2012. In 2013, $110,000 of dividends are declared and paid. What are the dividends received by the preferred and common shareholders in 2013?
	Preferred	Common
a.	$0	$110,000
b.	$50,000	$60,000
c.	$55,000	$55,000
d.	$70,000	$40,000



	4.	The board of directors must assign a per share value to a stock dividend declared that is
a.	greater than the par or stated value.
b.	less than the par or stated value.
c.	equal to the par or stated value.
d.	at least equal to the par or stated value.



	5.	Corporations generally issue stock dividends in order to
a.	increase the market price per share.
b.	exceed stockholders' dividend expectations.
c.	increase the marketability of the stock.
d.	decrease the amount of capital in the corporation.






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