Question

# E 11-1A. Dividend Distribution Lakeside Company has the following shares outstanding: 20,000 shares of \$50 par...

 E 11-1A. Dividend Distribution Lakeside Company has the following shares outstanding: 20,000 shares of \$50 par value, six percent cumulative preferred stock and 80,000 shares of \$10 par value common stock.  The company declared cash dividends amounting to \$160,000. a. If no dividends in arrears on the preferred stock exist, how much in total dividends, and in dividends per share, is paid to each class of stock? b. If one year of dividends in arrears exist on the preferred stock, how much in total dividends, and in dividends per share, is paid to each class of stock? a. Preferred Shares Total Dividend x Par value - Total Preferred Dividend x Dividend % Total Common Dividend Total Preferred Dividend Dividend per share Dividend per share b. Preferred Shares Total Dividend x Par value - Total Preferred Dividend x Dividend % Total Common Dividend Current Preferred Dividend Dividend per share Dividends in Arrears Total Preferred Dividend Dividend per share that is all the question gives me

#### Homework Answers

Answer #1

a) Calculate following

 Preferred shares 20000 Total Dividend 160000 x Par value 50 - Total Preferred Dividend -60000 x Dividend % 6% Total Common Dividend 100000 Total Preferred Dividend 60000 Dividend per share 100000/80000 = 1.25 Dividend per share 60000/20000 = 3

b) Calculate following

 Preferred shares 20000 Total Dividend 160000 x Par value 50 - Total Preferred Dividend -120000 x Dividend % 6% Total Common Dividend 40000 Current Preferred Dividend 60000 Dividend per share 40000/80000 = 0.50 Dividend in arrears 60000 Total preferred dividend 120000 Dividend per share 120000/20000 = 6
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