Question

Seventy-Two Inc., a developer of radiology equipment, has stock outstanding as follows: 80,000 shares of cumulative preferred 3% stock, $15 par, and 401,400 shares of $24 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $55,700 ; second year, $78,000 ; third year, $78,900 ; fourth year, $98,300.

Calculate the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places. If no dividends are paid in a given year, enter "0".

Answer 1

Statementshowing Computations
Paticulars	First year	Second Year	Third Year	Fourth Year
Total Dividend Paid	55,700.00	78,000.00	78,900.00	98,300.00
Preference Dividend to be paid = 80,000*15*3%	36,000.00	36,000.00	36,000.00	36,000.00
Preference Dividend Paid = Existing + arrears	36,000.00	36,000.00	36,000.00	36,000.00
Dividend available for common stock	19,700.00	42,000.00	42,900.00	62,300.00
Arrears of preference Dividend	-	-	-	-
Preference Dividend per share = Preference dividend/80,000	0.45	0.45	0.45	0.45
Common stock dividend=Dividend/401,400	0.05	0.10	0.11	0.16