Seventy-Two Inc., a developer of radiology equipment, has stock outstanding as f

Question

Seventy-Two Inc., a developer of radiology equipment, has stock outstanding as follows: 80,800 shares of cumulative preferred 4% stock, $15 par, and 398,300 shares of $23 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $55,000 ; second year, $77,800 ; third year, $78,100 ; fourth year, $101,400 .

Calculate the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places. If no dividends are paid in a given year, enter "0".

1st Year 2nd Year 3rd Year 4th Year Preferred stock (dividends per share) Common stock (dividends per share)

Explanation / Answer

Calculate dividend distribution :

Annual preferred dividend = 80800*15*4% = 48480

1st year 2nd year 3rd year 4th year Preferred dividend (dividend per share) 48480/80800=0.60 48480/80800=0.60 48480/80800=0.60 48480/80800=0.60 Common stock (dividend per share) 6520/398300=0.02 29320/398300=0.07 29620/398300=0.07 52920/398300=0.13

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