HW-1735 Investments 12 Week 5

5. What are the advantages associated with dividend reinvestment plans? P.274

6. How do stock dividends differ from cash dividends? How do stock dividends differ from stock splits? P 269

9. If a preferred stock is in arrearage, what does that imply about the dividend payment? P.280  

11. What does the statement of cash flows add to the analyst’s knowledge of the firm? P.282 about financial statement- cashflow statement ex. Exhbit 8.6

b) 10 percent stock dividend ( fair market value of stock is $ 13 per share) pay out 10% of 1,000,000 shares= # shares

FMV=$13

a) A cash dividend of $ 1 per share will pay out $1 to every share holder. Cash is now $19,000,000 retained earnings is now $97,500,00