Dividends

Andrews Company has $80,000 available to pay dividends. It has 2,000 shares of 10%, $100 par, preferred stock and 20,000 shares of $10 par common stock outstanding. The preferred stock is selling for $125 per share, and the common stock is selling for $25 per share.

Required

1. Determine the amount of dividends to be paid to each class of shareholder for each of the following independent assumptions. If an amount box required no entry, leave it blank.

a. Preferred stock is nonparticipating and noncumulative.

Andrews Company
Schedule of dividends to be paid
	Preferred	Common
Preferred dividend	$fill in the blank 783111fe5ff8f9c_1	fill in the blank 783111fe5ff8f9c_2
Remainder to common	fill in the blank 783111fe5ff8f9c_3	$fill in the blank 783111fe5ff8f9c_4
Total	$fill in the blank 783111fe5ff8f9c_5	$fill in the blank 783111fe5ff8f9c_6

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

Andrews Company
Schedule of dividends to be paid
	Preferred	Common
Dividends in arrears	$fill in the blank bdb03dfaf018040_1	$fill in the blank bdb03dfaf018040_2
Current preferred dividend	fill in the blank bdb03dfaf018040_3	$fill in the blank bdb03dfaf018040_4
Remainder to common	fill in the blank bdb03dfaf018040_5	fill in the blank bdb03dfaf018040_6
Total	$fill in the blank bdb03dfaf018040_7	$fill in the blank bdb03dfaf018040_8

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

Andrews Company
Schedule of dividends to be paid
	Preferred	Common
Dividends in arrears	$fill in the blank 4b93adf7eff3037_1	$fill in the blank 4b93adf7eff3037_2
Current preferred dividends	fill in the blank 4b93adf7eff3037_3	fill in the blank 4b93adf7eff3037_4
Common proportional share	fill in the blank 4b93adf7eff3037_5	fill in the blank 4b93adf7eff3037_6
Remainder shared	fill in the blank 4b93adf7eff3037_7	fill in the blank 4b93adf7eff3037_8
Total	$fill in the blank 4b93adf7eff3037_9	$fill in the blank 4b93adf7eff3037_10

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

	Dividend yield
Preferred stock	fill in the blank 0dcd07f9c02d000_1 %
Common stock	fill in the blank 0dcd07f9c02d000_2 %