Ace Inc.has 10,000 shares of 4%, $100 par value, cumulative preferred stock and 50,000 shares of $1 par value common stock outstanding at December 31, 2020.What is the annual dividend on the preferred stock?

Question

Quizplus · Accepted Answer

The annual dividend on the preferred stock is calculated as 4% of the par value ($100) per share. Therefore, the dividend per share is $4 (4% of $100), and with 10,000 shares, the total annual dividend is $40,000.

Ace IncHas 10,000 Shares of 4%, $100 Par Value, Cumulative Preferred