Question
The records of Hoffman Company reflected the following balances in the stockholders equity accounts at December 31, 2015: Common stock, par $12 per share, 43,500
The records of Hoffman Company reflected the following balances in the stockholders equity accounts at December 31, 2015: Common stock, par $12 per share, 43,500 shares outstanding. Preferred stock, 8 percent, par $17 per share, 6,610 shares outstanding. Retained earnings, $227,000. On January 1, 2016, the board of directors was considering the distribution of a $62,700 cash dividend. No dividends were paid during 2014 and 2015. Required: 1. Determine the total and per-share amounts that would be paid to the common stockholders and to the preferred stockholders under two independent assumptions: a. The preferred stock is noncumulative. The preferred stock is cumulative.
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