Please! explain the steps very clearly, i have to explain the answer to this question to others. Wedge Corporation has the following capital stock outstanding:$1 par value common stock, 250,000 shares.8% preferred stock, par $100, 5,000 shares, cumulative, with 2 years in arrears.Cash dividends of $150,000 were declared and paid near the end of the current year.Required:A. Calculate the dividends paid to the preferred stockholders.B. Calculate the dividends paid to the common stockholders. A. Preferred: (5,000 shares x $100 par x 8%) × 3 years = $120,000.B. Common: Total dividends $150,000 – dividends to preferred stockholders $120,000 =dividends paid to common stockholders $30,000.

Answered: A. Calculate the dividends paid to the…

A. Calculate the dividends paid to the preferred stockholders. B. Calculate the dividends paid to the common stockholders.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

Please! explain the steps very clearly, i have to explain the answer to this question to others.

Wedge Corporation has the following capital stock outstanding:
$1 par value common stock, 250,000 shares.
8% preferred stock, par $100, 5,000 shares, cumulative, with 2 years in arrears.
Cash dividends of $150,000 were declared and paid near the end of the current year.
Required:
A. Calculate the dividends paid to the preferred stockholders.
B. Calculate the dividends paid to the common stockholders.

A. Preferred: (5,000 shares x $100 par x 8%) × 3 years = $120,000.
B. Common: Total dividends $150,000 – dividends to preferred stockholders $120,000 =
dividends paid to common stockholders $30,000.

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