Ritz Company had the following shares outstanding and Retained Earnings at December 31, 2014: On December 31,

Question:

Ritz Company had the following shares outstanding and Retained Earnings at December 31, 2014:

On December 31, 2014, the board of directors is considering the distribution of a cash dividend to the common and preferred shareholders. No dividends were declared during 2012 or 2013. Three independent cases are assumed:
Case A: The preferred shares are noncumulative; the total amount of 2014 dividends would be $30,000.
Case B: The preferred shares are cumulative; the total amount of 2014 dividends would be $30,000. Dividends were not in arrears prior to 2012.
Case C: Same as Case B, except the amount is $75,000.
Required:
Compute the amount of dividends, in total and per share, payable to each class of share- holders for each case. Show computations. Round per share amounts to two decimal places.

Distribution
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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...