Question

Perfect Seed Inc. has 1,000,000 shares of 5%, $80 par value preferred stock authorized, of which, 23,000 shares are issued. None of the preferred shares are being held as treasury. What is the maximum dividend per share on each preferred share

Answer 1

$4.00

Step-by-step explanation:

The dividend per share on a preferred share is written as the percentage of par value.

In the current situation:

Dividend per share = 5% * Par value = 5% * $80 = $4

So the maximum dividend paid will be $4.