On January 2, 2015, Easton Corporation issued 50,000 shares of 5% cumulative preferred stock at $100 par value. No dividends have been paid to any shareholders since the formation of the corporation. Management wants to issue a dividend to common shareholders on December 31, 2016. What dividend amount, if any, must be paid to the preferred stockholders entitled before any distribution is made to common stockholders?

answer

watching

views

For unlimited access to Homework Help, a Homework+ subscription is required.

You have 0 free answers left.
Get unlimited access to 3.8 million step-by-step answers.

Get unlimited access

Already have an account? Log in

Deanna HettingerLv2

7 May 2018

Unlock all answers

Get 1 free homework help answer.

Already have an account? Log in

Related questions

Best-Cost Corporation issues 5 million shares of common stock and 100,000 shares of 6 percent cumulative preferred stock at $100 par. The corporation has not paid any dividend during the previous 3 years. The board of directors decides to pay $5 million in dividends for the current year.

a. How much in dividends is paif for each share of preferred stock?

b. What is the total amount of dividends paid to preferred stockholders?

c.How much is the dividend payment for each share of common stock?

d. What is the toal amount of dividends paid to common stockholders?

roseoyster930

2. Kilgore Auto Parts reported the following information at December 31, 2004:

Preferred stock, 10%, $10 par value, cumulative $60,000

Common stock, $2 par value 10,000

Additional paid-in capital â Common stock 30,000

Retained earnings 50,000

Total contributed capital and retained earnings 150,000

Less: Treasury stock (100 shares common stock at cost) (5,000)

Total stockholdersâ equity $145,000

A) How many shares of common stock are issued?

B) How many shares of preferred stock are issued?

C) How many shares of common stock are outstanding?

D) What was the average price paid for the treasury shares when the company reaquired them?

E) What is the dividend PER SHARE that preferred shareholders are entitled to when a dividend is declared?

F) What was the average price of common shares when they were issued?

G) If a 15% stock dividend were issued, by how much would the total stockholdersâ equity balance change?

blackcat900

The stockholder's equity accounts of a corporation on January 1, 2015, were as follows:

Preferred Stock (5%, $10 par, cumulative, 5000 shares authorized) $35,000

Common Stock ($5 par, 500,000 shares authorized) $750,000

APIC - Preferred Stock $205,800

APIC - Common Stock $2,220,000

Retained Earnings $857,000

During 2015, the corporation had the following transactions and events relating to its stockholders equity.

Jan.12 Purchased 2,500 shares of its own common stock to add to the Treasury at a cost of $53,750

Mar.17 Issued 10,000 shares of common stock in exchange for a building. On the date of the exchange, the FMV of the buiding was $212,000 and the stock was trading at $20.25 per share.

May.21 Sold 1,000 shares of treasury stock - common for $24 per share.

Nov.5 Issued 500 shares of preferred stock for $36,000

Dec.31 Determined that net income for the year was $226,000. Dividends were declared and paid during December. These dividends included a $0.20 per share dividend to common stockholders of record as of December 20. There are no dividends in arrears.

1.As of Dec.31, 2015, what is the average selling price of the preferred stock?

2.How many shares of common stock are outstanding as of December 31, 2015?

3 What is total amount of dividends declared and paid in 2015?

4. What is total stockholder's equity as of December 31, 2015?