Question

Dividends Per Share Imaging Inc., a developer of radiology equipment, has stock outstanding as follows: 23,000 shares of cumulative preferred 4% stock, $140 par, and 77,000 shares of $20 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $86,250; second year, $181,350; third year, $218,050; fourth year, $233,520. Compute 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". 1st Year 2nd Year 3rd Year 4th Year Preferred stock (dividend per share) $ $ $ $ Common stock (dividend per share) $ $ $ $

Answer 1

• All working forms part of the answer
• Working

	Par Value per Preferred Share	Dividend rate	Dividend per Preferred Share	No. of Preferred Shares	Preferred Dividend
Annual Preferred Dividend:	$                        140	4.00%	$                   5.600	23,000	$          128,800.00
	Total Cash Dividend paid	Paid to Preferred	Paid to Common	Dividends in Arrears at Year end
1st year	$            86,250.00	$           86,250.00	$                          -	$          42,550.00
2nd year	$          181,350.00	$        171,350.00	$           10,000.00	$                          -
3rd year	$          218,050.00	$        128,800.00	$           89,250.00	$                          -
4th year	$          233,520.00	$        128,800.00	$        104,720.00	$                          -
TOTAL	$          719,170.00	$        515,200.00	$        203,970.00	$                          -

• Answer

	1st year	2nd year	3rd year	4th year
Preferred Dividend:
Total	$              86,250.00	$      171,350.00	$      128,800.00	$ 128,800.00
Dividend per share [total / 23000 shares]	$                         3.75	$                   7.45	$                   5.60	$               5.60
Common Stock Dividend:
Total	$                              -	$        10,000.00	$        89,250.00	$ 104,720.00
Dividend per share [total / 77000 shares]	$                              -	$                   0.13	$                   1.16	$               1.36