Fairmount Inc., a developer of radiology equipment, has stock outstanding as fol

Question

Fairmount Inc., a developer of radiology equipment, has stock outstanding as follows: 23,000 shares of cumulative preferred 3% stock, $110 par, and 77,000 shares of $20 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $50,830; second year, $70,610; third year, $150,920; fourth year, $199,870. 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".

Explanation / Answer

Calculate the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places.

Annual preferred dividend = 23000*110*3% = 75900

Preferred dividend Common dividend Total dividend Total Per share Total Per share First year 50830 50830 2.21 0 0 Second year 70610 70610 3.07 0 0 Third year 150920 106260 4.62 44660 0.58 Fourth year 199870 75900 3.30 123970 1.61 Total 472230 303600 13.20 168630 2.19

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