Question

Sunland Corporation was organized on January 1, 2019. During its first year, the corporation issued 2,000 shares of $50 par value preferred stock and 106,000 shares of $10 par valve common stock. At December 31, the company declared the following cash dividends: 2019, $6,500; 2020, $14,400, and 2021, $29,000. Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 7% and noncumulative. 2020 2021 Allocation to preferred stock Allocation to common stock Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 9% and cumulative. 2019 2020 2021 Allocation to preferred stock Allocation to common stock matically indented when amount is entered. Do not indent manually. If Journalire the declaration of the cash dividend at December 11, 2021, under part (b). (Credit account titles are no entry is required, select "No Entry for the account titles and enter for the amounts Date Account Titles and Explanation Debit Credit

Answer 1

Solution: a) Annual preferred stock dividend 2000*50*7% 7000 2019 2020 2021 6500 14400 6500 7000 O 7400 Dividend 29000 allocation to Preferred stock allocation to common stock 7000 22000 b) Annual preferred stock dividend 2000*50*9% 9000 2019 2020 2021 6500 14400 6500 11500 0 2900 Dividend 29000 allocation to Preferred stock allocation to common stock 9000 20000 *wokring Annual preferred dividend Less : paid in 2019 Accrued dividend for 2019 Annual preferred dividend for 2020 allocation to Preferred stock in 2020 11500 9000 6500 2500 9000 c) Account title Dec 31,2021 cash dividend dividend payable Debit Credit Date 29000 29000