Harry Potter Corporation had the following stocks issued and outstanding when the board of directors proposed a $ 150,000 dividend Preferred stock 45,000 shares issued and 40,000 shares outstanding, 8 percent, $ 10 par value Common stock 60,000 shares issued and 50,000 outstanding, $ 1 par value Re...

Preferred stock dividend 40000 10 008 32000 A1 Preferred stock 32000 Common stock 250000 3200 ...

Harry Potter Corporation had the following stocks issued and outstanding when the board of directors proposed a

Question:

Harry Potter had the following issued and outstanding when the board of directors proposed a $ 150,000
Preferred stock: 45,000 shares issued and 40,000 shares outstanding, 8 percent, $ 10
Common stock: 60,000 shares issued and 50,000 outstanding, $ 1
Required:
A. Determine the amount of dividends each class of stock would receive given the following assumptions:
1. Preferred stock is noncumulative.
2. Preferred stock is cumulative (one year in arrears).
3. Preferred stock is cumulative (two years in arrears).
B. What is the per share for preferred and in each of the scenarios described in part A?
Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Stocks
Stocks or shares are generally equity instruments that provide the largest source of raising funds in any public or private listed company's. The instruments are issued on a stock exchange from where a large number of general public who are willing... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...