SwiftyCorporation's December 31, 2021 balance sheet showed the following: 7% preferred stock, $20 par value, cumulative, 9000 shares authorized; 6500 shares issued $ 130000 Common stock, $10 par value, 1000000 shares authorized; 975000 shares issued, 960000 shares outstanding 9750000 Paid-in capital in excess of par-preferred stock 30000 Paid-in capital in excess of par-common stock 13660000 Retained earnings 3740000 Treasury stock (14600 shares) 315000 Swiftydeclared and paid a $59000 cash dividend on December 15, 2021. If the company's dividends in arrears prior to that date were $10900, Swifty's common stockholders received O $39000. O $25000. O $48100. O $0.
Dividend Valuation
Dividend refers to a reward or cash that a company gives to its shareholders out of the profits. Dividends can be issued in various forms such as cash payment, stocks, or in any other form as per the company norms. It is usually a part of the profit that the company shares with its shareholders.
Dividend Discount Model
Dividend payments are generally paid to investors or shareholders of a company when the company earns profit for the year, thus representing growth. The dividend discount model is an important method used to forecast the price of a company’s stock. It is based on the computation methodology that the present value of all its future dividends is equivalent to the value of the company.
Capital Gains Yield
It may be referred to as the earnings generated on an investment over a particular period of time. It is generally expressed as a percentage and includes some dividends or interest earned by holding a particular security. Cases, where it is higher normally, indicate the higher income and lower risk. It is mostly computed on an annual basis and is different from the total return on investment. In case it becomes too high, indicates that either the stock prices are going down or the company is paying higher dividends.
Stock Valuation
In simple words, stock valuation is a tool to calculate the current price, or value, of a company. It is used to not only calculate the value of the company but help an investor decide if they want to buy, sell or hold a company's stocks.
Question-based on, "stockholders".
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Annual preferred dividends = Number of preferred shares issued x Par value per preferred share x Dividend rate
Annual preferred dividends = 6,500 x 20 x 7%
Annual preferred dividends = $9,100
Dividend in arrears = $10,900
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