Chapter 8, Problem 8.10E

To determine

Concept Introduction:

Dividend Dividend is the reward given by the company from its residual profit to its shareholders. It can be in the form of cash or otherwise. It is given by the board of directors only after shareholder's approval through their voting rights. It is not mandatory for a company to declare dividends.

Requirement 1:

Average price at which shares were issued

To determine

Concept Introduction:

Dividend Dividend is the reward given by the company from its residual profit to its shareholders. It can be in the form of cash or otherwise. It is given by the board of directors only after shareholder's approval through their voting rights. It is not mandatory for a company to declare dividends.

Requirement 2:

The balance sheet caption for common stock

To determine

Concept Introduction:

Dividend Dividend is the reward given by the company from its residual profit to its shareholders. It can be in the form of cash or otherwise. It is given by the board of directors only after shareholder's approval through their voting rights. It is not mandatory for a company to declare dividends.

Requirement 3:

Dividend to be paid to shareholders

To determine

Concept Introduction:

Dividend Dividend is the reward given by the company from its residual profit to its shareholders. It can be in the form of cash or otherwise. It is given by the board of directors only after shareholder's approval through their voting rights. It is not mandatory for a company to declare dividends.

Treasury shares are those shares which are bought by the company itself, thereby reducing the number of shares outstanding. These shares do not have voting rights and are not entitled for dividends.

Requirement 4

Cause of difference between issued and outstanding shares