York’s outstanding stock consists of 70,000 shares of noncumulative 7.5% preferr

Question

York’s outstanding stock consists of 70,000 shares of noncumulative 7.5% preferred stock with a $5 par value and also 120,000 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and paid the following total cash dividends:

2015 total cash dividends $15,000

2016 total cash dividends 24,200

2017 total cash dividends 265,000

2018 total cash dividends 415,000

Determine the amount of dividends paid each year to each of the two classes of stockholders: preferred and common. Also compute the total dividends paid to each class for the four years combined. (Round your "Dividend per Preferred Share" answers to 3 decimal places.)

par value per preferred share dividends dividends per preferred shar number of preferred shares preferred dividends annual preferred dividend total cash dividends paid paid to preferred paid to common dividends in arrears at year-end 2015 $     15,000 2016         24,200 2017        265,000 2018        415,000 total: $      719,200

Explanation / Answer

**since preferred share is non cummulative ,there will be no dividend in arrear .

par value per preferred share dividends dividends per preferred shar number of preferred shares preferred dividends annual preferred dividend 5 7.5% 5*7.5% = .375 70000 26250 total cash dividends paid paid to preferred paid to common dividends in arrears at year-end 2015 15000 15000 0 0 2016 24200 24200 0 0 2017 265000 26250 265000-26250= 238750 0 2018 415000 26250 388750 Total 719200 91700 627500

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