Question

Sandpiper Company has 15,000 shares of cumulative preferred 1% stock, $150 par and 50,000 shares of $5 par common stock.

The following amounts were distributed as dividends:

20Y1 $45,000

20Y2 11,300

20Y3 67,500

Determine the dividends per share for preferred and common stock for each year. Round all answers to two decimal places. If an answer is zero, enter '0'.

Answer 1

	20Y1	20Y2	20Y3
Preferred stock Dividend	$22,500 (15,000 Shares x $150 x 1%)	$11,300 (Since Max restricted)	$33,700
		[$22,500 (-) $11,300] $11,200 Arrear	($22,500 + $11,200 Arrear )
		(15,000 Shares x $150 x 1%)	(15,000 Shares x $150 x 1%)
Common stock Dividend	$22,500 ($45,000 (-) $22,500)	$ 0	$ 33,800 ($67,500 (-) $ 33,700)
	Preferred stock (dividends per share)	Common stock (dividends per share)
20Y1	$1.50 ($22,500 / 15,000)	$ 0.45 ($22,500 / 50,000)
20Y2	$0.75 ($11,300 / 15,000 )	$ 0
20Y3	$2.25 ($ 33,700 / 15,000 )	$ 0.68 ($ 33,800 / 50,000)