Question

Atlantis Corporation has 10 comma 000 shares of 12 ​%, $ 84.00 par noncumulative preferred stock outstanding and 20 comma 000 shares of nominus par common stock outstanding. At the end of the current​ year, the corporation declares a dividend of $ 194 comma 000 . How is the dividend allocated between preferred and common​ stockholders?

Answer 1

Step-by-step explanation:

The dividend allocated between preferred and common shareholders is:-The dividend is allocated $100800 to preferred shareholders & $93200to common shareholders.

Explanation:-

Total dividend declared =$194000

Dividend to preferred shareholders = ($10,000 shares*$84per share)*12%

=$100800

Dividend to common shareholders= Total dividend declared- Dividend to preferred shareholders

=$194000-$100800

=$93200