Accounting for cash dividends (Learning Objective 4) 10–15 min.

The following elements of stockholders’ equity are adapted from the balance sheet of Sandler Corporation.

Preferred Stock, cumulative, $2 par (Note 7), 65,000 shares issued and outstanding Common Stock, $0.10 par, 8,750,000 shares issued and outstanding

$130 875 Stockholders’ Equity $ Thousands Note 7. Preferred Stock: Designated annual cash dividend per share, $0.75.

Sandler Corporation paid no preferred dividends in 2014, but paid the designated amount of cash dividends per share to preferred shareholders in all prior years.

Requirement 1. Compute the dividends to preferred and common shareholders for 2015 if total dividends are $175,000.

AppendixLO1