The shareholder's equity of Loveless Corporation on December 31, 2022 shows the following balances:

Preference shares, 12% P100 par                                                                      P 1,000,000

Ordinary share, P100                                                                                                 4,100,000

Subscribed Preference share                                                                                    200,000

Subscription receivable-Preference                                                                        50,000

Share Premium-Ordinary                                                                                        2,000,000

Retained Earnings                                                                                                        3,000,000

Preference share treasury shares (2,000 shares)                                                 250,000

Ordinary share treasury shares (1,000 shares)                                                       125,000

Dividends have not been paid for 2 years (including the current year)

 

Required: Assume that 80% of the retained earnings are available for distribution as cash dividend. Compute for the dividends per share under each of the conditions with respect to preference share: (Show solutions)

1. Noncumulative and nonparticipating
2. Cumulative and nonparticipating
3. Noncumulative and participating
4. Cumulative and participating
5. Cumulative and participating up to 16%