Required: 1. Determine the amount of annual dividends on each issue of preferred stock and the total annual dividend on all four issue Issue 1 ($25 par, 10%) of preferred stock Issue 2 ($42 par, 8%, cumulative) of preferred stock Issue 3 ($50 par, 12%, cumulative, convertible) of preferred stock Issue 4 ($80 par, 11%, nonparticipating) of preferred stock Total annual dividend 2. Calculate what the amount of dividends in arrears would be if the dividends were omitted for 1 year.

Required: 1. Determine the amount of annual dividends on each issue of preferred stock and the total annual dividend on all four issue Issue 1 ($25 par, 10%) of preferred stock Issue 2 ($42 par, 8%, cumulative) of preferred stock Issue 3 ($50 par, 12%, cumulative, convertible) of preferred stock Issue 4 ($80 par, 11%, nonparticipating) of preferred stock Total annual dividend 2. Calculate what the amount of dividends in arrears would be if the dividends were omitted for 1 year.

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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Declared interim dividends for preferred shareholders as well as $.80 per share to common stockholders. Using the info above and as a guide: Prepare the journal entries with narrations to record the following: The issuances of stock. Close out net income to retained earnings. Dividend declared. Close out dividend to retained earnings.
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