January 1 2011 X company had 100,000 shares of $0.50 par value common stock outstanding. The market value of X common stock was $18 per share. X retained earnings balance on January 1 was $460,000 during 2010 X had declared and paid cash dividends of $0.75 per share. Net Income for2011 is expected to be $130,000. X has a large loan from OO bank part of the loan agreement stipulates that X must maintain a minimum Retained Earnings balance of $350,000. X Board of Directors is debating whether to declare a stock dividend in addition to its$0.75 per share annual cash dividend. 3 proposals have been presented (1) no stock dividend (2) a 10% stock dividend and (3) a 25% stock dividend...
which of the three proposals do you favor support your answer
Thank you in advance for you help