Question
Shrin Automotive has the following share structure in 2020: 80,000 no-par value common shares: $800,000 40,000, $0.80 preferred shares: $200,000 Dividends have been paid regularly
Shrin Automotive has the following share structure in 2020: 80,000 no-par value common shares: $800,000 40,000, $0.80 preferred shares: $200,000 Dividends have been paid regularly up to 2017; however, no dividends were declared or paid in 2018 or 2019. In 2020, the board of directors wishes to distribute $125,000 in dividends. Required :a) How much will the common shareholders and the preferred shareholders receive in dividends in 2020 if the preferred shares are non-cumulative and non-participating? b) How much will the common shareholders and the preferred shareholders receive in dividends in 2020 if the preferred shares are cumulative and non-participating?
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