Yellow Corporation has 270 shares of $100, 9% noncumulative nonparticipating preferred stock and 1,510 shares of $8 par value common stock outstanding. The company paid $7,500 cash dividends to stockholders in the current year. Preferred stockholders received:

Question

Quizplus · Accepted Answer

The preferred stock dividend is calculated as 270 shares * $100 par value * 9% = $2,430. Since the preferred stock is noncumulative, they receive this amount, and the remainder goes to common stockholders.

Yellow Corporation Has 270 Shares of $100, 9% Noncumulative Nonparticipating