Use the following information for the Exercises below. The following information
ID: 2406770 • Letter: U
Question
Use the following information for the Exercises below. The following information applies to the questions displayed below] 2 York's outstanding stock consists of 85,000 shares of noncumulative 60% preferred stock with a $5 par value and 150,000 shares of common stock with a $1 par value. During its first four years of operation, the corporation declare paid the following total cash dividends 2016 total cash dividends 2017 total cash dividends 2018 total cash dividends ok 23,580 280,800 nt Exercise 11-8 Dividends on common and noncumulative preferred stock L O C2 int Determine the amount of dividends paid each year to each of the two classes of stockholders: preferred and common Also c the total dividends paid to each class for the four years combined. (Round your "Dividend places.) per Preferred Share" answers to 3 Par Value per Dividend per Preferred Dividend Rate Preferred Preferredreferred Dividend Share Paid to Common Total Cash Paid to Arrears at ear end Dividend Paid Preferred 13,900 S 13.900 S 2015 2016 2017 2018 23.500 280,000 430,000 280.000 S 747,400$ 317,400SExplanation / Answer
Note: As it is given in the question that preferred stock is noncummulative that is why unpaid dividend will not be accumulated for next years. Thus there will be no dividend arrears at the end of year because preferred dividend will be paid as per available profits and in case lower profits low amount of dividends will be paid.
Par value per preferred share
Dividend rate
Dividend per preferred share
Number of preferred shares
Preferred dividend
Annual preferred dividend
$5
6%
$0.3
85000
$25500
Total cash dividend paid
Paid to preferred
Paid to common
Dividends in arrears at year-end
2015
$13900
$13900
Nil
Nil
2016
$23500
$23500
Nil
Nil
2017
$280000
$25500
$254500
Nil
2018
$430000
$25500
$404500
Nil
Total
$747400
$88400
$659000
Par value per preferred share
Dividend rate
Dividend per preferred share
Number of preferred shares
Preferred dividend
Annual preferred dividend
$5
6%
$0.3
85000
$25500
Total cash dividend paid
Paid to preferred
Paid to common
Dividends in arrears at year-end
2015
$13900
$13900
Nil
Nil
2016
$23500
$23500
Nil
Nil
2017
$280000
$25500
$254500
Nil
2018
$430000
$25500
$404500
Nil
Total
$747400
$88400
$659000