Question

Dividend Distribution Chauncey Corporation began business on June 30, 2016. At that time, it issued 20,000 shares of $50 par value, six percent, cumulative preferred stock and 90,000 shares of $10 par value common stock. Through the end of 2018, there had been no change in the number of preferred and common shares outstanding. Required a. Assume that Chauncey declared dividends of $69,000 in 2016, $0 in 2017, and $354,000 in 2018. Calculate the total dividends and the dividends per share paid to each class of stock in 2016, 2017, and 2018. Round to two decimal places. Preferred Common Preferred Common Year Stock Stock per share per share, 2016 $ 60,000 $ 9,000 $ 2017 0 0 2018 0 0 b. Assume that Chauncey declared dividends of $0 in 2016, $120,000 in 2017, and $186,000 in 2018. Calculate the total dividends and the dividends per share paid to each class of stock in 2016, 2017, and 2018. Round to two decimal places. Preferred Common Preferred Common Year Stock Stock per share per share 2016 $ 2017 0 2018 0 0

Answer 1

a) Preferred dividend = 20000*50*6% = 60000

Year	preferred stock	Common Stock	Preferred per share	Common per share
2016	60000	9000	3	0.10
2017	0	0	0	0
2018	120000	234000	6	2.60

b) Preferred dividend = 20000*50*6% = 60000

Year	preferred stock	Common Stock	Preferred per share	Common per share
2016	0	0	0	0
2017	120000	0	6	0
2018	60000	126000	3	1.40