Walker Computer Company is a small, closely held corporation. Derek Wallace, president, holds 80% of the stock. Of the remainder, 10% is held by members of his family and 10% by Kathy Baker, a former officer who is now retired. The balance sheet of the company at June 30, 2020, was substantially as shown below.

Cash	$ 22,000		Current Liabilities	$ 50,000
Other assets	450,000		Common Stock	250,000
	$ 472,000		Retained Earnings	172,000
				$ 472,000

Additional authorized common stock of $300,000 par value has never been issued. To strengthen the cash position of the company, Walker issued common stock with a par value of $100,000 to himself at par for cash. At the next stockholders meeting baker objected and claimed that her interests had been injured.

C. If Derek Walker offered Baker a personal cash settlement and they agreed to employ you as an impartial arbitrator to determine the amount, what settlement would you propose? Present your calculations with sufficient explanation to satisfy both parties.

D. How would your answer to c. above differ if Dereks family members also objected?