Question

Q 11.41: Jackson Essentials wants to pay a cash dividend to its stockholders. It has a balance of $3,847,318 in its Retained Earnings account and a Cash balance of $1,994,746. What is it missing in order for Jackson Essentials to be able to pay a cash dividend

Answer 1

In order to be able to pay a cash dividend, we must first need to calculate its amount. Cash dividends are paid to every outstanding stock, and in order to determine the total amount we need the cash dividend per stock and the total number of stocks outstanding. Before we can distribute anything, we must know what we are distributing.