York’s outstanding stock consists of 90,000 shares of noncumulative 7.5% preferr
ID: 2596200 • Letter: Y
Question
York’s outstanding stock consists of 90,000 shares of noncumulative 7.5% preferred stock with a $5 par value and also 270,000 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:
Exercise 11-9 Dividends on common and cumulative preferred stock LO C2
Determine the amount of dividends paid each year to each of the two classes of stockholders assuming that the preferred stock is cumulative. Also determine the total dividends paid to each class for the four years combined. (Round your "Dividend per Preferred Share" answers to 3 decimal places.)
2015 total cash dividends $ 23,000 2016 total cash dividends 31,700 2017 total cash dividends 235,000 2018 total cash dividends 385,000Explanation / Answer
Par Value per Preferred Share Dividend Rate Dividend per Preferred Share Number of Preferred Shares Preferred Dividend Annual Preferred Dividend: 5 7.50% 0.375 90000 33750 Total Cash Dividend Paid Paid to Preferred Paid to Common Dividends in Arrears at year-end 2015 23000 23000 0 10750 2016 31,700 31,700 0 12800 2017 235,000 46550 188450 2018 385,000 33750 351250 Totals $674,700 $135,000 $539,700
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