Question

12 HW eBook Calculator Dividends Per Share Lightfoot Inc., a software development firm, has stock outstanding as follows: 30,000 shares of cumulative preferred 4% stock, $20 par, and 38,000 shares of $125 par common During its first four years of operations, the following amounts were distributed as dividends: first year $9,000; second year $15,000; third year, $77,260; fourth year, $123,560. 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". Preferred stock (dividend per share) Common stock (dividend per share) novo

Answer 1

		Ist Year	2nd Year	3rd Year	4th Year
Dividend paid		9,000	15,000	77,260	1,23,560
Preferred Shares	=(30000*20) 6,00,000	(6,00,000*4%)= 24,000	(6,00,000*4%)   24,000	(6,00,000*4%)     24,000	(6,00,000*4%)     24,000
Common Stock	(38000*125)= 47,50,000	0	0	(77260-24000)= 53,260	(123560-24000)= 99,560
Subject to maximum of		9000 ( As only 9000 is paid, whole amount will be paid to preference shareholders as they have priority in dividend payment over equity shares.	15000 ( As only 15000 is paid, whole amount will be paid to preference shareholders as they have priority in dividend payment over equity shares.