Question: You own 5 000 shares of 4 par value common stock

You own 5,000 shares of $4 par value common stock of Cohen & Cohen Hardware Corp. The company has 50,000 shares of common stock outstanding. Cohen & Cohen does not have any other classes of stock outstanding.
(a) If Cohen & Cohen declares a cash dividend of $30,000, how much of this dividend can you expect to receive? What is the amount of dividend per share?
(b) If Cohen & Cohen decides to sell an additional 14,000 shares of common stock, how many of these shares will you be entitled to purchase? Explain.
(c) Presently, Cohen & Cohen’s total stockholders’ equity is $3,200,000, and the company’s common stock is trading for $71 per share on a major stock exchange. What is the total ‘‘value’’ of the Cohen & Cohen shares that you own? What is the book value of each of your shares? Is either of these amounts equal to the amount you paid for the shares? Explain.

Sale on SolutionInn
  • CreatedMarch 27, 2015
  • Files Included
Post your question