The dividends per share for preferred and common stock, respectively is: $10.31; $15.00. None of the answer choices are correct.
The entry reflects the transfer of $72,000 from retained earnings to the property dividends payable account. (Option A).
How to Solve the Problem?
A. To calculate the dividends per share for preferred and common stock, we need to consider the number of shares outstanding for each type of stock.
Preferred Stock:
Number of shares of preferred stock = 32,000
Dividend per share = $330,000 / 32,000 = $10.31 (rounded to two decimal places)
Common Stock:
Number of shares of common stock = 22,000
Dividend per share = $330,000 / 22,000 = $15.00 (rounded to two decimal places)
B. The first entry that should be recorded related to this dividend is:
Retained earnings (debit) - $72,000
Property dividends payable (credit) - $72,000
This entry reflects the transfer of $72,000 from retained earnings to the property dividends payable account.