The records of Hoffman Company reflected the following balances in the shareholders' equity accounts at December 31 of the current year: Common shares, no par value, 45,500 shares outstanding Preferred shares, $3, no par value, 7,200 shares outstanding Retained earnings On September 1 of the current year, the board of directors was considering the distribution of a $79,840 cash dividend. No dividends were paid during the previous two years. You have been asked to determine dividend amounts under two independent assumptions (show computations): a. The preferred shares are non-cumulative. b. The preferred shares are cumulative. Required: 1. Determine the total amounts that would be paid to the preferred shareholders and to the common shareholders under the two independent assumptions. (Round "Per share" to 2 decimal places.) a. Noncumulative: Total Per share b. Cumulative: Total Per share $910,000 156,000 247,000 Preferred Common

The records of Hoffman Company reflected the following balances in the shareholders' equity accounts at December 31 of the current year: Common shares, no par value, 45,500 shares outstanding Preferred shares, $3, no par value, 7,200 shares outstanding Retained earnings On September 1 of the current year, the board of directors was considering the distribution of a $79,840 cash dividend. No dividends were paid during the previous two years. You have been asked to determine dividend amounts under two independent assumptions (show computations): a. The preferred shares are non-cumulative. b. The preferred shares are cumulative. Required: 1. Determine the total amounts that would be paid to the preferred shareholders and to the common shareholders under the two independent assumptions. (Round "Per share" to 2 decimal places.) a. Noncumulative: Total Per share b. Cumulative: Total Per share $910,000 156,000 247,000 Preferred Common

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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St. Laurence reports the following data: Throughout the year, St. Laurence has outstanding 150,000 no par common shares and 20,000 no par, $ 0.40, preferred shares issued at $ 5 each. The company’s balance sheet also reports that the preferred shares are cumulative and non-participating. The data shows dividends were paid every year except the past two years and the current year. How much dividends will the common shareholders received if $50,000 wwas distributed? How much dividends will the preferred shareholders receive if $21,000 will be distributed in the year?
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