Question

York's outstanding stock consists of 80,000 shares of noncumulative 6.0% preferred stock with a $5 par value and also 300.000 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 Year 2 total cash dividends Year 3 total cash dividends Year 4 total cash dividends $13,000 22,000 250,000 400,000 Determine the amount of dividends paid each year to each of the two classes of stockholders: preferred and common. (Round your "Dividend per Preferred Share answer to 3 decimal places.) Par Value per Preferred Share Dividend Rate Dividend per Preferred Share Number of Preferred Shares Dividend Annual Preferred Dividend: Total Cash Dividend Paid Pald to Preferred paid to Common Dividends in Arrears at year-end Year 1 250,000 685.000 SESTORE < Prey 6 of 9 !!! Next >

Answer 1

Solution:

	Par value per prefered share	Dividend Rate	Dividend per preferred share	Number of preferred shares	Preferred dividend
Annual preferred dividend:	$5.00	6.0%	$0.300	80000	$24,000.00
	Total cash dividend paid	Paid to preferred	Paid to common	Dividends in Arrears at year end
Year 1	$13,000.00	$13,000.00	$0.00	$0.00
Year 2	$22,000.00	$22,000.00	$0.00	$0.00
Year 3	$250,000.00	$24,000.00	$226,000.00	$0.00
Year 4	$400,000.00	$24,000.00	$376,000.00	$0.00
Total	$685,000.00	$83,000.00	$602,000.00