Lauer Company has 1,000 shares of $300 par value, 5% cumulative preferred stock and 50,000 shares of $60 par value common stock outstanding. The company paid total cash dividends of $6,000 in its first year of operation, and declared total cash dividends of $30,000 in its second year of operation.
The cash dividend paid to common stockholders in the second year will be:

Question

Quizplus · Accepted Answer

($300 × 1,000 × 5%) = $15,000 Dividends payable to Preferred each year
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Lauer Company Has 1,000 Shares of $300 Par Value, 5