Dividends on Preferred and Common 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, $80,000; Year 2, $90,000; Year 3, $150,000; Year 4, $150,000; Year 5, $160,000; and Year 6, $180,000. During the entire period ended December 31 of each year, the outstanding stock of the company was composed of 250,000 shares of cumulative preferred 2% stock, $20 par, and 500,000 shares of common stock, $15 par. Required: 1. Determine the total dividends and the per-share dividends declared on each class of stock for each of the six years. There were no dividends in arrears at 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 Total Year Dividends Total Per Share Total Per Share Year 1 $ 80,000 90,000 Year 2 Year 3 150,000 Year 4 150,000 Year 5 160,000 Year 6 180,000 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 $25.00 for the preferred stock and $17.50 for the common stock, determine the average annual percentage return on initial shareholders' investment, based on the average annual dividend per share (A) for preferred stock and (B) for common stock. Round your answers to two decimal places. Preferred stock Common stock Issuing Stock Professional Products Inc., a wholesaler of office products, was organized on February 5 of the current year, with an authorization of 50,000 shares of preferred 2% stock, $40 par and 1,000,000 shares of $8 par common stock. The following selected transactions were completed during the first year of operations: Journalize the transactions. Feb. 5. Issued 600,000 shares of common stock at par for cash. Feb. 5 -_ Feb. 5. Issued 1,500 shares of common stock at par to an attorney in payment of legal fees for organizing the corporation. Feb. 5 - Apr. 9. Issued 45,000 shares of common stock in exchange for land, buildings, and equipment with fair market prices of $100,000, $310,000, and $85,000 respectively. For a compound transaction, if an amount box does not require an entry, leave it blank. Apr. 9 June 14. Issued 30,000 shares of preferred stock at $53 for cash. For a compound transaction, if an amount box does not require an entry, leave it blank. June 14 Selected Dividend Transactions, Stock Split Selected transactions completed by Canyon Ferry Boating Corporation during the current fiscal year are as follows. Journalize the transactions. If no entry is required, select "No entry required" and leave the amount boxes blank. For a compound transaction, if an amount box does not require an entry, leave it blank. Jan. 8. Split the common stock 2 for 1 and reduced the par from $80 to $40 per share. After the split, there were 150,000 common shares outstanding. Jan. 8 Apr. 30. Declared semiannual dividends of $0.75 on 18,000 shares of preferred stock and $0.28 on the common stock payable on July 1. Apr. 30 July 1. Paid the cash dividends. July 1 Oct. 31. Declared semiannual dividends of $0.75 on the preferred stock and $0.14 on the common stock (before the stock dividend). In addition, a 5% common stock dividend was declared on the common stock outstanding. The fair market value of the common stock is estimated at $52. Cash dividends Stock dividends Dec. 31. Paid the cash dividends and issued the certificates for the common stock dividend. Payment Issuance Stockholders' Equity Section of Balance Sheet Specialty Auto Racing Inc. retails racing products for BMWs, Porsches, and Ferraris. The following accounts and their balances appear in the ledger of Specialty Auto Racing on July 31, the end of the current year: Common Stock, $36 par $10,080,000 Paid-In Capital from Sale of Treasury Stock-Common 340,000 Paid-In Capital in Excess of Par-Common Stock 420,000 Paid-In Capital in Excess of Par-Preferred Stock 384,000 Preferred 1% Stock, $150 par 7,200,000 Retained Earnings 71,684,000 Treasury Stock-Common 1,008,000 Fifty thousand shares of preferred and 300,000 shares of common stock are authorized. There are 24,000 shares of common stock held as treasury stock. Prepare the Stockholders' Equity section of the balance sheet as of July 31, the end of the current year, using Method 1 of Exhibit 9. Specialty Auto Racing Inc. Stockholders' Equity July 31, 20xx Paid-In Capital: - Total Paid-In Capital Total Total Stockholders' Equity