Question

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York’s outstanding stock consists of 75,000 shares of noncumulative 8.0% preferred stock with a $5 par value and also 130,000 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.
  

Year 1 total cash dividends	$	18,600
Year 2 total cash dividends		28,000
Year 3 total cash dividends		270,000
Year 4 total cash dividends		420,000

Use the data in Exercise 13-10 to determine the amount of dividends paid each year to each of the two classes of stock assuming that the preferred stock is cumulative. (Round your "Dividend per Preferred Share" answer to 3 decimal places.)

Answer 1

rate positively .

		Annual preferred dividend = 75000*5*8%=		30000
		Since dividend are cumulative any unpaid or under paid amount will be paid in subsequent year
		Year 1	Year 2	Year 3	Year 4
		Preferred stock	Common eqiuty	Preferred stock	Common eqiuty	Preferred stock	Common eqiuty	Preferred stock	Common eqiuty
Dividend		18600	0	28000	0	43400	226600	30000	390000