Knudsen Corporation was organized on January 1, 2013. During its first year, the
ID: 2421385 • Letter: K
Question
Knudsen Corporation was organized on January 1, 2013. During its first year, the corporation issued 2,000 shares of $50 par value preferred stock and 109,800 shares of $10 par value common stock. At December 31, the company declared the following cash dividends: 2013, $7,000; 2014, $14,200; and 2015, $28,300.
A: Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 7% and non cumulative for the following
2013 2014 2015
Allocation to preferred stock
Allocation to common stock
Explanation / Answer
Allocation of dividend:
2013 2014 2015
preferred stock 7000 7000 7000
common stock 0 7200 21300
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