Dividing cash dividends between preferred and common stock [5-10 min]Precious Metal Trust...

Dividing cash dividends between preferred and common stock [5-10 min]

Precious Metal Trust has the following stockholders’ equity:

Requirements

1. Is Precious Metal’s preferred stock cumulative or noncumulative? How can you tell?

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2. Precious Metal declares cash dividends of $25,000 for 2010. How much of the dividends goes to preferred? How much goes to common?

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3. Precious Metal passed the preferred dividend in 2011 and 2012. In 2013 the company declares cash dividends of $35,000. How much of the dividend goes to preferred? How much goes to common?