Question

Dividends Per Share

Lightfoot Inc., a software development firm, has stock outstanding as follows: 20,000 shares of cumulative preferred 4% stock, $20 par, and 25,000 shares of $50 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $6,000; second year, $10,000; third year, $50,250; fourth year, $78,000.

Calculate the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places. If no dividends are paid in a given year, enter "0".

	1st Year	2nd Year	3rd Year	4th Year
Preferred stock (dividend per share)	$	$	$	$
Common stock (dividend per share)	$	$	$	$

PLEASE MAKE SURE IT'S ANSWERED CORRECTLY AND ROUNDED OFF TO TWO DECIMAL PLACES. THANK YOU!

Answer 1

Cumulative preferred dividends=$20*20,000*4%

=$16,000

First Year preferred dividend arrears=$16,000-$6,000

=$10,000

second Year preferred dividend arrears=$16,000-$10,000

=$6,000

Third year preferred dividend+preferred dividend arrears

=$16,000+$10,000+$6,000

=$32,000