The outstanding stock is composed of 10,000 shares of $100par, cumulative prefer

Question

The outstanding stock is composed of 10,000 shares of $100par, cumulative preferred $8 stock, and 50,000 shares of no-parcommon stock. Preferred dividends have been paid every year exceptfor the preceding year and the current year. If $380,000 is to bedistributed as a dividend for the current year, what total amountwill be distributed to the preferred stockholders?
a. $380,000 b. $0 c. $80,000 d. $160,000 The outstanding stock is composed of 10,000 shares of $100par, cumulative preferred $8 stock, and 50,000 shares of no-parcommon stock. Preferred dividends have been paid every year exceptfor the preceding year and the current year. If $380,000 is to bedistributed as a dividend for the current year, what total amountwill be distributed to the preferred stockholders?
a. $380,000 b. $0 c. $80,000 d. $160,000

Explanation / Answer

10000*=80000 : so the preferred shareholders are due 80000 per year.......andthey are paid first : so 80000+80000=$160000(for last yearand current year)

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