CAB Inc.has 1000 shares of 5% $100 par value cumulative preferred stock and 50000 shares of $1 par value common stock outstanding at December 31 2021.What is the annual dividend on the preferred stock?

Question

Quizplus · Accepted Answer

The annual dividend on the preferred stock is calculated as 5% of the $100 par value per share. Therefore, 5% of $100 is $5 per share. With 1000 shares, the total annual dividend is $5 * 1000 = $5000.

CAB IncHas 1000 Shares of 5% $100 Par Value Cumulative Preferred