Discussion Post
A stockbroker advises a client to buy preferred stock, saying "With that type of stock, you will never have to worry about losing the dividends." Is the broker right?
Part I
A Corporation reacquires 60,000 shares of its own $10 par common stock for 3,000,000 recording it at cost
i. What effect does this transaction have on revenue or expense for the period
ii. What effect does it have on stockholders equity?
Part II
An owner of 2500 shares of Simmons Company common stock receives a stock dividend of 50 shares.
i. What is the effect of the stock dividend on the stockholder's proportionate interest (equity) in the corporation?
ii. How does the total equity of 2550 shares compare with the total equity of 2500 shares before the stock dividend?
The response must include a reference list. Using Times New Roman 12 pnt font, double-space, one-inch margins, and APA style of writing and citations.