Dividends
Dividends have been declared at year-end. For each independent case below, determine the total amount of dividends that each class of stock will receive. For all cases assume there are 8,000 shares outstanding of $10 par value common stock and 2,000 shares outstanding of 10%, $100 par value preferred stock. Show your calculations.
|
Case |
Total Dividends Declared |
Preferred Stock Cumulative |
Preferred Dividends in Arrears |
Total Amount to Preferred |
Total Amount to Common |
|
A |
$40,000 |
No |
No |
$ |
$ |
|
B |
100,000 |
No |
No |
$ |
$ |
|
C |
75,000 |
Yes |
1 year |
$ |
$ |
|
D |
85,000 |
Yes |
3 years |
$ |
$ |
|
E |
15,000 |
Yes |
No |
$ |
$ |
Stock Splits, Dividends and Restrictions on Retained Earnings
Match each item/event pair below with the indicated change in the item. An individual classification may be used more than once, or not at all. For each dividend, assume that both declaration and payment or distribution has occurred.
Classifications
A. Item increases
B. Item decreases
C. Item is unchanged
D. Direction of change cannot be determined
|
Classification |
Item |
Event |
|
1. |
Book value per share |
Stock dividend |
|
2. |
Par value per common share |
Cash dividend |
|
3. |
Total retained earnings |
Stock split |
|
4. |
Earnings per common share |
Restriction of retained earnings |
|
5. |
Number of common shares outstanding |
Stock dividend |
|
6. |
Total retained earnings |
Cash dividend |
|
7. |
Total paid in capital |
Stock dividend |
|
8. |
Par value per common share |
Stock dividend |