The books of a company carried the following account balances as of 12/31/20. Cash. $181,000 Preferred stock (6% cumulatie nonparticipating $50 par). $302,000 Common Stock (no-par value 305,000 share issued) 1,525,000 Paid in Capital in Excess of Par -Preferred stock 144,000 Treasury Stock (common 3,000 shares at cost) 35,700 Retained Earning. 104,200 The company decided not to pay any dividend in 2020 The board at the 2021 annual meeting declared "The current year dividend shall be 6% on the preferred and $0.40 per share on the common. THe dividends in arrears shall be paid by issuing 1,510 shares of treasury stock. At the date of declaration the preferred is selling at $83 per share and the common at $12 per share. Net income is estimated at $80,600 Prepare the journal entries: for preferred dividends in arrears for preferred current year dividend for common share dividend Could the company give the preferred stockholders 2 years dividends and common stockholders a 40 cents per share dividend all in cash?
The books of a company carried the following account balances as of 12/31/20.
Cash. $181,000
Common Stock (no-par value 305,000 share issued) 1,525,000
Paid in Capital in Excess of Par -Preferred stock 144,000
The company decided not to pay any dividend in 2020
The board at the 2021 annual meeting declared "The current year dividend shall be 6% on the preferred and $0.40 per share on the common. THe dividends in arrears shall be paid by issuing 1,510 shares of treasury stock. At the date of declaration the preferred is selling at $83 per share and the common at $12 per share. Net income is estimated at $80,600
Prepare the
for preferred dividends in arrears
for preferred current year dividend
for common share dividend
Could the company give the preferred stockholders 2 years dividends and common stockholders a 40 cents per share dividend all in cash?
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