DividendsonPreferredandCommon Stock

Pecan Theatre Inc. owns and operates movie theaters throughout Florida and Georgia. Pecan Theatre has declared the following annual dividends over a six-year period: Year 1, $32,000; Year 2, $64,000; Year 3, $144,000; Year 4, $184,000; Year 5, $224,000; and Year 6, $280,000. During the entire period ended December 31 of each year, theoutstanding stockof the company was composed of 40,000 shares ofcumulative preferred2% stock, $100par, and 100,000 shares of common stock, $10 par.

Required:

1.Determine the total dividends and the per-share dividends declared on each class ofstockfor each of the six years. There were no dividendsin arrearsat the beginning of Year 1. Summarize the data in tabular form. If required, round your answers to two decimal places. If the amount is zero, please enter "0".

Preferred Dividends Common Dividends

Year Total Dividends Total Per Share Total Per Share

Year 1 $32,000 $ $ $ $

Year 2 64,000

Year 3 144,000

Year 4 184,000

Year 5 224,000

Year 6 280,000

$ $

2.Determine the average annual dividend per share for each class of stock for the six-year period. If required, round your answers to two decimal places.

Average annual dividend for preferred $___per share

Average annual dividend for common $____per share

3.Assuming a market price per share of $115 for the preferred stock and $16 for the common stock, determine the average annual percentage return on initial shareholders' investment, based on the average annual dividend per share for preferred stock and for common stock.

Round your answers to two decimal places.

Preferred stock____%

Common stock_____%

Help with explanation please