Explanation Cash dividends: The amount of cash provided by a corporation out of its distributable profits to its shareholders as a return for the amount invested by them is referred as cash dividends. Common stock: These are the ordinary shares that a corporation issues to the investors in order to raise funds. In return, the investors receive a share of profit from the profits earned by the corporation. The dividend payments are not guaranteed and are paid after the payment made to the preferred stockholders. Preferred stock: The stock that provides a fixed amount of return (dividend) to its stockholder before paying dividends to common stockholders is referred as preferred stock. A preferred stock may be cumulative and non-cumulative. A cumulative preferred stock implies that a preferred stockholder is entitled to receive dividends for the current year plus any unpaid dividends of the previous years, before the dividends paid to the common stockholders. Dividend per share: Dividend per share represents the amount of dividend paid to each shareholders of the business. In first year, L Incorporation has paid only $36,000 as dividend in total. Therefore, preference shareholders get only $36,000 as dividends in first year; remaining balance of $14,000 ( $ 50 , 000 ( 1 ) − $ 36 , 000 ) would be paid as dividend in arrears in future. In second year, L Incorporation has paid $58,000 as dividend in total. Therefore, preference shareholders get $58,000 as dividends in second year, which includes $44,000 for current year plus $14,000 dividends in arrears

15th Edition

ISBN: 9781337955423

Author: WARREN, JONES

Publisher: CENGAGE L

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Chapter 12, Problem 2E

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Determine the dividends per share for preferred and common stock for each year.

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Chapter 12 Solutions

FINANCIAL & MANAGERIAL ACCW/CENGAGENOWV

Ch. 12 - Of two corporations organized at approximately the...Ch. 12 - A stockbroker advises a client to buy preferred...Ch. 12 - A corporation with both preferred stock and common...Ch. 12 - Prob. 4DQ Ch. 12 - Prob. 5DQ Ch. 12 - Prob. 6DQ Ch. 12 - A corporation reacquires 60,000 shares of its own...Ch. 12 - Prob. 8DQ Ch. 12 - Prob. 9DQ Ch. 12 - Prob. 10DQ

Ch. 12 - Dividends per share Zero Calories Company has...Ch. 12 - Entries for issuing stock On January 22, Zentric...Ch. 12 - Entries for cash dividends The declaration,...Ch. 12 - Entries for stock dividends Alpine Energy...Ch. 12 - Entries for treasury stock On May 27, Hydro...Ch. 12 - Reporting stockholders equity Using the following...Ch. 12 - Statement of stockholders equity Noric Cruises...Ch. 12 - Earnings per share Financial statement data for...Ch. 12 - Dividends per share Seventy-Two Inc., a developer...Ch. 12 - Prob. 2E Ch. 12 - Prob. 3E Ch. 12 - Entries for issuing no-par stock On May 15, Helena...Ch. 12 - Issuing stock for assets other than cash On...Ch. 12 - Selected stock transactions Alpha Sounds Corp., an...Ch. 12 - Issuing stock Willow Creek Nursery, with an...Ch. 12 - Issuing stock Professional Products Inc., a...Ch. 12 - Entries for cash dividends The declaration,...Ch. 12 - Prob. 10E Ch. 12 - Prob. 11E Ch. 12 - Prob. 12E Ch. 12 - Selected dividend transactions, stock split...Ch. 12 - Treasury stock transactions Mystic Lake Inc....Ch. 12 - Prob. 15E Ch. 12 - Treasury stock transactions Biscayne Bay Water...Ch. 12 - Reporting paid-in capital The following accounts...Ch. 12 - Stockholders' Equity section of balance sheet The...Ch. 12 - Stockholders' Equity section of balance sheet...Ch. 12 - Retained earnings statement Sumter Pumps...Ch. 12 - Prob. 21E Ch. 12 - Statement of stockholders equity The stockholders...Ch. 12 - Dividends on preferred and common stock Pecan...Ch. 12 - Stock transactions for corporate expansion On...Ch. 12 - Selected stock transactions The following selected...Ch. 12 - Entries for selected corporate transactions Morrow...Ch. 12 - Prob. 5PA Ch. 12 - Dividends on preferred and common stock Yosemite...Ch. 12 - Stock transaction for corporate expansion Pulsar...Ch. 12 - Selected stock transactions Diamondback Welding ...Ch. 12 - Entries for selected corporate transactions Nav-Go...Ch. 12 - Prob. 5PB Ch. 12 - Selected transactions completed by Equinox...Ch. 12 - Analyze and compare Amazon.com and Wal-Mart...Ch. 12 - Analyze and compare Bank of America and Wells...Ch. 12 - Analyze Pacific Gas and Electric Company Pacific...Ch. 12 - Prob. 4MAD Ch. 12 - Prob. 5MAD Ch. 12 - Ethics in Action Tommy Gunn is a division manager...Ch. 12 - Prob. 2TIF Ch. 12 - Communications Motion Designs Inc. has paid...

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