Xerox Corp. reports the following stockholders' equity information in its \(10-\mathrm{K}\) report.

Required

a. At December 31, 2012, Xerox reports \(\$ 349\) million of \(8 \%\) Series A Convertible Preferred stock. What is the dollar amount of dividends that Xerox must pay on this stock (assume a par value of \(\$ 100\) per share)?

b. Describe the effects that will occur to Xerox's balance sheet and its income statement when the Series A Convertible Preferred stock is converted.

c. What is the benefit, if any, of issuing equity securities with a conversion feature? How are these securities treated in the computation of earnings per share (EPS)?
Merck \& Co., Inc. (MRK)

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Shareholders' Equity (In millions, except share data in thousands) Series A convertible preferred stock Common stock, $1 par value.. Additional paid-in capital. Treasury stock, at cost... Retained earnings Accumulated other comprehensive loss Xerox shareholders' equity..... (In millions, except share data in thousands) Balance at December 31, 2011 Comprehensive income.. Cash dividends declared-common stock Cash dividends declared-preferred stock. Contribution of common stock to U.S. pension plan... Stock option and incentive plans, net... Payments to acquire treasury stock, including fees. Cancellation of treasury stock. Distributions to noncontrolling interests.. Balance, December 31, 2012.... Additional Common Paid-in Treasury Retained Stock Capital Stock Earnings $1,353 - 15 18 - (147) $1,239 $6,317 $ (124) $7,046 1,195 (226) (24) 115 115 (925) (1,052) 1,072 $5,622 $ (104) $7,991 December 31 2012 $ 349 1,239 5,622 (104) 7,991 (3,227) $11,521 $(2.716) (511) 2011 $(3,227) $ 349 1,353 6,317 (124) Accumulated Non- Other Com- Xerox prehensive Shareholders' controlling Total Loss Interests Equity Equity $12,025 7,046 (2,716) $11,876 $11,876 684 (226) (24) 130 133 (1,052) $11,521 $149 28 (34) $143 712 (226) (24) 130 133 (1,052) (34) $11,664