Question

Garda World Security Corporation has the following shares, taken from the equity section of its balance sheet dated December 31, 2020.

Preferred shares, $4.52 non-cumulative,
49,000 shares authorized and issued*	$	3,136,000
Common shares,
84,000 shares authorized and issued*		1,344,000

*All shares were issued during 2018.

During its first three years of operations, Garda World Security Corporation declared and paid total dividends as shown in the last column of the following schedule.

Required:

Part A
1. Calculate the total dividends paid in each year to the preferred and to the common shareholders.

Year Preferred Dividend Common Dividend Total Dividend

2018 $164,000

2019 $404,000

2020 $564,000

Total for three years $1,132,000

2. Calculate the dividends paid per share to both the preferred and the common shares in 2020. (Round the final answers to 2 decimal places.)

Part B
1. Calculate the total dividends paid in each year to the preferred shares and to the common shareholders assuming preferred shares are cumulative.

	Year Preferred Dividend Common Dividend Total Dividend 2018 $164,000 2019 404,000 2020 564,000 Total for three years $0 $0 $1,132,000

2. Calculate the dividends paid per share to both the preferred and the common shares in 2020 assuming preferred shares are cumulative. (Round the final answers to 2 decimal places.)

Answer 1

1.)	Annual Preferred Dividend	$ 221,480	(4.52 x 49,000 )
	Year	Preferred Dividend	Common Dividend	Total Dividend $
	2018	164,000	-	164,000
	2019	221,480	182,520	404,000
	2020	221,480	342,520	564,000
	Total for three years	606,960	525,040	1,132,000
2.)	Dividends per Share-2020
	Preferred Dividend	$ 4.52	( 221,480 / 49,000 )
	Common Dividend	$ 4.08	( 342,520 / 84,000 )