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PART 1 - Directions A corporation was organized on January 1 and issued the following shares of stock: 2,500 shares of $100 par value, 8%
PART 1 - Directions
A corporation was organized on January 1 and issued the following shares of stock:
- 2,500 shares of $100 par value, 8% non-participating preferred stock.
- 20,000 shares of $20 par value common stock.
All shares were issued and outstanding throughout the next three years. The corporation declared and paid a cash dividend in each of those years as follows:
Year 1 - $25,000 Year 2 - $8,000 Year 3 - $75,000
Required:
- Calculate the dividends paid to each class of stock in each of those years assuming the preferred stock is NON-CUMULATIVE. Use the matrix format listed below. Be sure to show your supporting calculations and label them to indicate which numbers in the matrix they are supporting.
Preferred | ||||
Total | Preferred | dividends | Common | |
dividend | dividends | carried forward | dividends paid | |
Year | declared | paid this year | to next year | this year |
1 | $25,000 |
|
|
|
2 | $8,000 |
|
|
|
3 | $75,000 |
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|
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