Do It! Review 11-3a Fint Corporation has 3,900 shares of 8%, $100 par value pref

Question

Do It! Review 11-3a Fint Corporation has 3,900 shares of 8%, $100 par value preferred stock outstanding at December 31, 2017, At December 31, 2017, the company declared a $126,500 cash dividend. Determine the dividend paid to preferred stockholders and common stockholders under each of the following scenarios. 1. The preferred stock is noncumulative, and the company has not missed any dividends in previous years. The dividend paid to preferred stockhoiders The dividend paid to common stockholders 2. The preferred stock is noncumulative, and the company did not pay a dividend in each of the two previous years The dividend paid to preferred stockholders The dividend paid to common stockholders 3. The preferred stock is cumulative, and the company did not pay a dividend in each of the two previous years. The dividend paid to preferred stockholders The dividend paid to common stockholders

Explanation / Answer

Annual preferred dividend=3900*100*8%= 31200 1 Dividend paid to preferred shareholders 31200 Dividend paid to common shareholders 95300 2 Dividend paid to preferred shareholders 31200 Dividend paid to common shareholders 95300 3 Dividend paid to preferred shareholders 93600 =31200*3 Dividend paid to common shareholders 32900

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