Sabas Company has issued and outstanding 37,000 shares of $100 par, 7% preferred stock and 95,000 shares of $50 par common stock. The following amounts were distributed as dividends: Year 1 $566,000 Year 2 478,000 Year 3 577,000 Determine the dividend per share for preferred and common stock for each year. If required, round your answers to two decimal places. Dividend per share: Year 1 Year 2 Year 3 Preferred stock $fill in the blank 1 $fill in the blank 2 $fill in the blank 3 Common stock $fill in the blank 4 $fill in the blank 5 $fill in the blank 6
Sabas Company has issued and outstanding 37,000 shares of $100 par, 7% preferred stock and 95,000 shares of $50 par common stock. The following amounts were distributed as dividends: Year 1 $566,000 Year 2 478,000 Year 3 577,000 Determine the dividend per share for preferred and common stock for each year. If required, round your answers to two decimal places. Dividend per share: Year 1 Year 2 Year 3 Preferred stock $fill in the blank 1 $fill in the blank 2 $fill in the blank 3 Common stock $fill in the blank 4 $fill in the blank 5 $fill in the blank 6
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Sabas Company has issued and outstanding 37,000 shares of $100 par, 7% preferred stock and 95,000 shares of $50 par common stock. The following amounts were distributed as dividends:
| Year 1 | $566,000 |
| Year 2 | 478,000 |
| Year 3 | 577,000 |
Determine the dividend per share for preferred and common stock for each year. If required, round your answers to two decimal places.
| Dividend per share: | Year 1 | Year 2 | Year 3 |
| Preferred stock | $fill in the blank 1 | $fill in the blank 2 | $fill in the blank 3 |
| Common stock | $fill in the blank 4 | $fill in the blank 5 | $fill in the blank 6 |
Expert Solution
Step 1: Understanding of preferred and common stock
Lets understand the basics.
Shares are divided into two types which are,
(1) Common stock holders
(2) Preferred stockholders
Common stockholders are the owners of the entity therefore they gets paid only after paying to all other type of shareholders.
Preferred shareholders are as name suggest gets preference over paying to equity shareholders.
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