CP11-4 Calculating Common and Preferred Cash Dividends [LO 11-2, LO 11-3, LO 11-4]

Tower Corp. had the following stock outstanding and Retained Earnings at December 31, 2015:

Common Stock (par $8; outstanding, 24,000 shares)	$	192,000
Preferred Stock, 9% (par $10; outstanding, 5,400 shares)		54,000
Retained Earnings		274,000

On December 31, 2015, the board of directors is considering the distribution of a cash dividend to the common and preferred stockholders. No dividends were declared during 2013 or 2014, and none have been declared yet in 2015. Three independent cases are assumed:

Case A:	The preferred stock is noncumulative; the total amount of 2015 dividends would be $12,000.
Case B:	The preferred stock is cumulative; the total amount of 2015 dividends would be $14,580. Dividends were not in arrears prior to 2013.
Case C:	Same as Case B, except the total dividends are $60,000.

Required:

1-a.	Compute the amount of 2015 dividends, in total that would be payable to each class of stockholders if dividends were declared as described in each case.
	TIP: Preferred stockholders with cumulative dividends are to be paid dividends for any prior years (in arrears) and for the current year before common stockholders are paid.

		Case A	Case B	Case C
Preferred
Common
Total

1-b.	Compute per case, the 2015 dividends per share, payable to each class of stockholders. (Round your answers to 2 decimal places.)

	Case A	Case B	Case C
Preferred
Common