Assignment # eBook Show Me How Calculator Dividends Per Share Sandpiper Company

Question

Assignment # eBook Show Me How Calculator Dividends Per Share Sandpiper Company has 25,000 shares of cumulative preferred 1% stock, $50 par and 50,000 shares of $15 par common stock. The following amounts were distributed as dividends: Year 1 Year 2 Year 3 $18,800 5,000 37,500 Determine the dividends per share for preferred and common stock for each year. Round all answers to two decimal places. If an answer is zero, enter '0" Preferred Stock Common Stock (dividend per share) (dividend per share) Year 1 Year 2 Year 3

Explanation / Answer

Note

Answer

Preferred Stock

[ dividend per share ]

Common Stock

[ dividend per share ]

Note : For Year 3 Preferred dividends consists of $12,500 of current year & ($12,500 -$5,000) ie $7,500 of dividend in arrears of Year 2.  

Year

Preferred Stock

[ dividend per share ]

Common Stock

[ dividend per share ]

Year 1 $12,500 / 25,000 shares = $0.50 ($18,800- $12,500) / 50,000 shares = $0.13 Year 2 $5,000 / 25,000 shares = $0.20 $0 Year 3 [$12,500 + ($12,500 -$5,000)] / 25,000 shares = $0.80 ($37,500 - $12,500 - $7,500) / 50,000 shares = $0.35

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