On July 2 of the current year, the board of directors of StarVideo Corporation declared an annual dividend of \($90,000.00.\) On the date of record, the corporation had issued 3,500 shares of 8%, \($80.00\) par-value preferred stock and 60,000 shares of \($12.00\) stated-value common stock.

Page 7 of a general journal and page 14 of a cash payments journal are provided in the Working Papers. Source documents are abbreviated as follows: check, C; memorandum, M. Work this problem independently.

1. Calculate the value of preferred stock.

2. Calculate the amount of dividends for the current year to be paid to preferred and common shareholders.

3. Journalize the entry to record the declaration of a dividend on July 2. M87.

4. Journalize the entry to record the payment of the dividend on August 2. C326.