Determining Cash Dividends to Preferred and Common ShareholdersSinclair Company has outstanding 28,000 shares of $50 par value, 6% cumulative preferred stock and 70,000 shares of $10 par value common stock. The company declares and pays cash dividends amounting to $196,000.a. If there are no preferred dividends in arrears, how much in total dividends, and in dividends per share, does Sinclair pay to each class of stock? Total DividendsDividends per SharePreferred shareholders:AnswerAnswerCommon shareholders:AnswerAnswerb. If there are one year’s dividends in arrears on the preferred stock, how much in total dividends, and in dividends per share, does Sinclair pay to each class of stock? Total DividendsDividends per SharePreferred shareholders:AnswerAnswerCommon shareholders:AnswerAnswer

Preferred stock at $50 per value = 28000 Common stock at $10 per value= 70000 A.) Total cash…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

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Determining Cash Dividends to Preferred and Common Shareholders
Sinclair Company has outstanding 28,000 shares of $50 par value, 6% cumulative preferred stock and 70,000 shares of $10 par value common stock. The company declares and pays cash dividends amounting to $196,000.

a. If there are no preferred dividends in arrears, how much in total dividends, and in dividends per share, does Sinclair pay to each class of stock?

	Total Dividends	Dividends per Share
Preferred shareholders:	Answer	Answer
Common shareholders:	Answer	Answer

b. If there are one year’s dividends in arrears on the preferred stock, how much in total dividends, and in dividends per share, does Sinclair pay to each class of stock?

	Total Dividends	Dividends per Share
Preferred shareholders:	Answer	Answer
Common shareholders:	Answer	Answer

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