1. Prepare the journal entry to record Tamas Company's issuance of 5,900 shares of $100 par value, 7% cumulative preferred stock for $105 cash per share. 2. Assuming the facts in part 1, if Tamas declares a year-end cash dividend, what is the amount of dividend paid to preferred shareholders? (Assume no dividends in arrears.) Complete this question by entering your answers in the tabs below. Required 1 Requireyi 2 Assuming the facts in part 1, if Tamas declares a year-end cash dividend, what is the amount of dividend paid to preferred shareholders? (Assume no dividends in arrears.) Dividend per Preferred Share Number of Par Value per Preferred Share Dividend Rate Preferred Dividend Preferred Shares 100 7.0 % 24 7.00 5,900 $ 46,900 < Required 1 Required 2 >
1. Prepare the journal entry to record Tamas Company's issuance of 5,900 shares of $100 par value, 7% cumulative preferred stock for $105 cash per share. 2. Assuming the facts in part 1, if Tamas declares a year-end cash dividend, what is the amount of dividend paid to preferred shareholders? (Assume no dividends in arrears.) Complete this question by entering your answers in the tabs below. Required 1 Requireyi 2 Assuming the facts in part 1, if Tamas declares a year-end cash dividend, what is the amount of dividend paid to preferred shareholders? (Assume no dividends in arrears.) Dividend per Preferred Share Number of Par Value per Preferred Share Dividend Rate Preferred Dividend Preferred Shares 100 7.0 % 24 7.00 5,900 $ 46,900 < Required 1 Required 2 >
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Can you please check my work
Transcribed Image Text:1. Prepare the journal entry to record Tamas Company's issuance of 5,900 shares of $100 par value, 7% cumulative preferred stock for
$105 cash per share.
2. Assuming the facts in part 1, if Tamas declares a year-end cash dividend, what is the amount of dividend paid to preferred
shareholders? (Assume no dividends in arrears.)
Complete this question by entering your answers in the tabs below.
Require 1
Required 2
Prepare the journal entry to record Tamas Company's issuance of 5,900 shares of $100 par value, 7% cumulative preferred stock for
$105 cash per share.
View transaction list
View journal entry worksheet
No
Transaction
General Journal
Debit
Credit
A
1
Cash
619,500
Preferred stock, $100 par value
590,000
Paid-in capital in excess of par value, preferred stock
29,500
< Required 1
Required 2 >
Transcribed Image Text:1. Prepare the journal entry to record Tamas Company's issuance of 5,900 shares of $100 par value, 7% cumulative preferred stock for
$105 cash per share.
2. Assuming the facts in part 1, if Tamas declares a year-end cash dividend, what is the amount of dividend paid to preferred
shareholders? (Assume no dividends in arrears.)
Complete this question by entering your answers in the tabs below.
Required 1
Requireri 2
Assuming the facts in part 1, if Tamas declares a year-end cash dividend, what is the amount of dividend paid to preferred
shareholders? (Assume no dividends in arrears.)
Par Value per
Preferred
Dividend per
Preferred
Share
Number of
Preferred
Shares
Dividend
Preferred
Rate
Dividend
Share
100
7.0 % $
7.00
5,900
2$
46,900
< Required 1
Required 2 >
%24
Expert Solution
Step 1
Cumulative preferred stock (likewise called cumulative preference shares) is a class of favored stock whose profits collect in the event that they are not paid at whatever year and must be delivered in future before any profits are paid to normal investors.
Preferred dividend must be delivered before any profits are paid to normal investors. In the event that at whatever year, there isn't sufficient overall gain to deliver off any profits, the profits due on favored stock for the year must be conveyed forward and the gathered parity must be paid in future years when net gain is certain and at exactly that point can any profits on common stock can be announced.
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