Question

Seventy-Two Inc., a developer of radiology equipment, has stock outstanding as follows: 70,000 shares of cumulative preferred 3% stock, $20 par, and 405,000 shares of $25 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $34,000; second year, $74,000; third year, $90,000; fourth year, $120,000. 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 "0.00". 1st Year 2nd Year 3rd Year 4th Year Preferred stock (dividends per share) $ $ $ $ Common stock (dividends per share)

Answer 1

	Year 1	Year 2	Year 3	Year 4
Preferred stock total dividend	$        34,000	$ 50,000	$ 42,000	$ 42,000
No of preferred shares	70,000	70,000	70,000	70,000
Dividend per share	$            0.49	$       0.71	$       0.60	$       0.60
Common stock total dividend	$                 -	$ 24,000	$ 48,000	$ 78,000
No of common shares	405,000	405,000	405,000	405,000
Dividend per share	$                 -	$       0.06	$       0.12	$       0.19

Computation for preferred stock dividend payment