Denson, Inc. has 10,000 shares of 7%, $100 par value, non-cumulative preferred stock and 40,000 shares of $1 par value common stock outstanding at December 31, 2014. There were no dividends declared in 2013. The board of directors declares and pays a $100,000 dividend in 2014. What is the amount of dividends received by the common stockholders in 2014? $50.000. $100,000. $30.000 $70,000.
Show transcribed image textDenson, Inc. has 10,000 shares of 7%, $100 par value, non-cumulative preferred stock and 40,000 shares of $1 par value common stock outstanding at December 31, 2014. There were no dividends declared in 2013. The board of directors declares and pays a $100,000 dividend in 2014. What is the amount of dividends received by the common stockholders in 2014? $50.000. $100,000. $30.000 $70,000.
Timber Ridge Corporationwas organized on January 1, 2013. During its first year, thecorporation issued 40,000 shares of $5 par value preferred stockand 400,000 shares of $1 par value common stock. At December 31,the company declared the following cash dividends:
2013 $ 8,000
2014 $30,000
2015 $70,000
Instructions
(a) Showthe allocation of dividends to each class of stock, assuming thepreferred stock dividend is 5% and not cumulative.
(b) Showthe allocation of dividends to each class of stock, assuming thepreferred stock dividend is 6% and cumulative.
(c) Journalize the declaration of the cashdividend at December 31, 2015 using the assumption of part(b).