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The shareholders equity of Kramer Industries includes the data shown below. During 2022, cash dividends of...

The shareholders equity of Kramer Industries includes the data shown below. During 2022, cash dividends of $150 million were declared. Dividends were not declared in 2020 or 2021.

Common Stock $200

Paid-in Capital-excess of par, common 800

Preferred stock, 10%, nonparticipating 100

Paid-in capital-excess of par, preferred 270

Required:

Determine the amount of dividends payable to preferred shareholders and to common shareholders under each of the following two assumptions regarding the characteristics of the preferred stock. Show JE's at declaration and additional JE for both Assumptions!

Assumption A – The preferred stock is noncumulative

Assumption B – The preferred stock is cumulative

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