Question

Dividends Per Share Oceanic Company has 20,000 shares of cumulative preferred 2% stock, $100 par and 50,000 shares of $25 par common stock. The following amounts were distributed as dividends: Year 1 $60,000 Year 2 32,000 Year 3 120,000 Determine the dividends per share for preferred and common stock for each year. Round all answers to two decimal places. If an answer is zero, enter 'o'. Year 1 Year 2 Year 3 Preferred stock (Dividends per share) Common stock (Dividends per share) $

Answer 1

Dividend per year for preferred stock = Preferred shares * Par value * Dividend % = 20000 * 100 * 2%

40000

Year	Total dividend paid	Dividend paid to preferred stock	Dividend paid to common stock	Dividend in arrears for preferred stock
1	60000	40000	20000	0
2	32000	32000	0	8000
3	120000	48000	72000	0

Answer :
	Year 1	Year 2	Year 3
Preferred stock ( Dividends per share ) [ Dividend paid to preferred stock / 20000 ]	2	1.6	2.4
Common stock ( Dividends per share ) [ Dividend paid to common stock / 50000 ]	0.4	0	1.44