A corporation had the following stock outstanding when the company's board of directors declared a $95,000 cash dividend in the current year:
$\begin{array}{|l|r|}
\hline \text { Preferred stock, } \$ 100 \text { par, } 6 \%, 5,000 \text { shares issued } & \$ 500,000 \
\hline \text { Common stock, } \$ 10 \text { par, } 70,000 \text { shares issued } & 700,000 \
\hline \text { Total } & \$ 1,200,000 \
\hline
\end{array}$ Allocate the cash dividend between the preferred and common stockholders assuming the preferred stock is noncumulative and nonparticipating.

Question

A corporation had the following stock outstanding when the company's board of directors declared a $95,000 cash dividend in the current year:
 $\begin{array}{|l|r|}
\hline \text { Preferred stock, } \$ 100 \text { par, } 6 \%, 5,000 \text { shares issued } & \$ 500,000 \
\hline \text { Common stock, } \$ 10 \text { par, } 70,000 \text { shares issued } & 700,000 \
\hline \text { Total } & \$ 1,200,000 \
\hline
\end{array}$ Allocate the cash dividend between the preferred and common stockholders assuming the preferred stock is noncumulative and nonparticipating.

Quizplus · Accepted Answer

The Answer of A corporation had the following stock outstanding when the company's board of directors declared a $95,000 cash dividend in the current year:
 $\begin{array}{|l|r|}
\hline \text { Preferred stock, } \$ 100 \text { par, } 6 \%, 5,000 \text { shares issued } & \$ 500,000 \
\hline \text { Common stock, } \$ 10 \text { par, } 70,000 \text { shares issued } & 700,000 \
\hline \text { Total } & \$ 1,200,000 \
\hline
\end{array}$ Allocate the cash dividend between the preferred and common stockholders assuming the preferred stock is noncumulative and nonparticipating.

A Corporation Had the Following Stock Outstanding When the Company's