Niley-Cook Corporation issued 200000 shares of $20 par value 6% preferred stock on January 1 2015 for $4500000. In December 2017 Niley-Cook declared its first dividend of $800000.
Instructions
(a) Prepare Niley-Cook's journal entry to record the issuance of the preferred stock.
(b) If the preferred stock is not cumulative how much of the $800000 would be paid to common stockholders?
(c) If the preferred stock is cumulative how much of the $800000 would be paid to common stockholders?

Question

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The Answer of Niley-Cook Corporation issued 200000 shares of $20 par value 6% preferred stock on January 1 2015 for $4500000. In December 2017 Niley-Cook declared its first dividend of $800000.
Instructions
(a) Prepare Niley-Cook's journal entry to record the issuance of the preferred stock.
(b) If the preferred stock is not cumulative how much of the $800000 would be paid to common stockholders?
(c) If the preferred stock is cumulative how much of the $800000 would be paid to common stockholders?

Niley-Cook Corporation Issued 200000 Shares of $20 Par Value 6