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Metromat Has the Following Equity Accounts on Its Balance Sheet

Question 18

Multiple Choice

Metromat has the following equity accounts on its balance sheet:
Metromat has the following equity accounts on its balance sheet: The current market price of Metromat's shares is $16.If the firm declares a 15% stock dividend and a $0.15 per share cash dividend, what will be the impact on contributed capital in excess of par? Assume a marginal tax rate of 40%. A) decreases $2.56 million B) increases $5.04 million C) increases $5.76 million D) does not change
The current market price of Metromat's shares is $16.If the firm declares a 15% stock dividend and a $0.15 per share cash dividend, what will be the impact on contributed capital in excess of par? Assume a marginal tax rate of 40%.


A) decreases $2.56 million
B) increases $5.04 million
C) increases $5.76 million
D) does not change

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