Andrews Company has $80000 available to pay dividends. It has 2000 shares of 10%, $100 par, preferred stock and 30,000 shares of $10 par common stock outstanding. The preferred stock is selling dfor $125 per share and teh common stock is selling for $20 per share.

Required

1.Determine the amount of dividends to be paid to each class of shareholder for each of the following independent assumptions

a.preferred stock is nonparticipating and noncumulative

b.Preferred stock is nonparticipating and cumulative. Preferred dividends are 2 years in arrears at teh beginning of the year

c.preferred stock is fully participating and cumulative. Preferred dividends are 1 year in arrears at teh beginning of the year

2.For 1 (a), compute the dividend yield on the preferred stock and the common stock.