Question

A corporation has 12 comma 000 shares of 10​%, $ 102.00 par noncumulative preferred stock outstanding and 28 comma 000 shares of nominuspar common stock outstanding. At the end of the current​ year, the corporation declares a dividend of $ 220 comma 000. What is the dividend per share for preferred stock and for common​ stock? ​(Round your answer to the nearest​ cent.)

Answer 1

preferred 10.2 per share

common 3.49 per share

Step-by-step explanation:

the preferred stock will receive their dividends firsht:

12,000shares x $102 each x 12% return = 122.400‬

$122,400/12,000 shares = $10.2 per share

available for common stock:

220,000 declared dividends - 122,400 preferred= 97,600

$97,600 / 28,000 common stock = 3,4857 = $ 3.49