1.
Compute the amount of dividend as follows:
Par value preferred shares (A) | Dividend rate (B) | Total Annual Preferred Dividend [C= A × B] | Number of preferred shares (D) | Dividend per preferred shares [E = C/D] | Shares Owned (F) | Annual preferred dividend 100 shares [ G = E × F] |
$2,500,000 | 6.785% | $169,625 | 100,000 | $1.696 | 100 | $170 |
(Roundoff) |
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2.
Compute the amount of dividend will the shareholders receive:
Dividend paid on 100 shares paid in 2021 = Annual preferred dividend Number of years
= $170 3 years
= $510
Dividend paid on 100 shares is $510
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3.
Compute shares of common stock:
Number of convertible preferred shares owned (A) | Conversation Factor (B) | Number of common shares received [A × B] |
100 | $25/$30.31 | 82.5 |
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4.
Compute amount as follows:
Per share | Total 100 shares | |
Liquidation preference | $25 | |
Redemption percentage | 112% | |
Redemption percentage, June 18, 2017 ($25 × 112%) | $28 | |
Percent reduction in redemption price (1%+1%) | 2% | |
Redemption price June 18, 2019 [($28 × (100%-2%)] | $27.44 | $2,744 |
($27.44 × 100 shares) |
Ozark Distributing Company is primarily engaged in the wholesale distribution of consumer products in the Ozark...
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