In: Accounting
Requirement 1. Assuming the preferred stock is cumulative, compute the amount of dividends to preferred stockholders and to common stockholders for
2018
and
2019
if total dividends are
$13,400
in
2018
and
$46,000
in
20192019.
Assume no changes in preferred stock and common stock in
2019
(Assume all preferred dividends have been paid prior to
2018
Complete all input boxes. Enter a "0" for zero amounts. For the current year preferred dividend, be sure to enter the calculated dividend on the "current year dividend" line and the paid out dividend on the "total dividend to preferred stockholders" line.)
SouthernSouthern's
2018
dividend would be divided between preferred and common stockholders in this manner:
2018 |
|
Preference dividend for year (360000*4%) |
14400 |
But total dividend declared in 2018 is 13400. Remaining dividend (14400-13400 =1000) paid in future year because preferred stock are cumulative nature. |
|
Total dividend declared of 13400 for preferred stock. |
|
2019 |
|
Total dividend declared |
46000 |
Less: dividend paid to preferred stock for year 2019 (360000*4%) |
14400 |
Less: remaining dividend in 2018 for preferred stock |
1000 |
Dividend declared for common stock holder |
30600 |
2018 |
|
Dividend declared to preferred stock holder |
13400 |
Total dividend declared in 2018 |
13400 |
2019 |
|
Dividend declared to preferred stock holder for year 2019 |
14400 |
Dividend declared to preferred stock holder for year 2018 |
1000 |
Total dividend for preferred stock holder |
15400 |
Dividend declared for common stock holder |
30600 |
Total dividend declared in 2019 |
46000 |