Cash versus stock dividend Milwaukee Tool has the following stockholders' equity account. The firm's common...
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Cash versus stock dividend Milwaukee Tool has the following stockholders' equity account. The firm's common stock currently sells for $4.31 per share. Preferred stock $ 94,000 Common stock (200,000 shares at $0.97 par) 194,000 Paid-in capital in excess of par 220,000 Retained earnings 350,000 Total stockholders' equity $858,000 a. Show the effects on the firm of a cash dividend of $0.10 per share. b. Show the effects on the firm of a 20% stock dividend. C. Compare the effects in parts a and b. What are the significant differences between the two methods of paying dividends
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