Wilson Corporation issued and has outstanding 145,000 shares of $10 par-value co

Question

Wilson Corporation issued and has outstanding 145,000 shares of $10 par-value common stock and 2,900 shares of $60 par-value 25 percent preferred stock. The board of directors votes to distribute $5,800 as dividends in 2016, $8,700 in 2017, and $333,500 in 2018 Compute the total dividend and the dividend for each share paid to preferred stockholders and common stockholders each year under the following assumed situations. Case A: The preferred stock is nonparticipating and noncumulative. (Round your per share answers to 2 decimal places.) Total Preferred Stock Common Stock Year TotalPer ShareTota Per Share 2016 S 5,800 S 5,800 2017 2018 0 S 10.00 2.50 43,500 290,000.00 290,000 290,000.00 43,500.00 8,700 145,000.00 8,700 333,500 Case B: The preferred stock is cumulative and nonparticipating. (Round your per share answers to 2 decimal places.) Total Preferred Stock Common Stock Year TotalPer ShareTota Per Share 2016 S 5,800 S 5,800 43,500.00 2017 8,700 8,700 15.00 2018 333,500 43,500 29,000.00 290,000 Analyze: If a stockholder purchased 340 shares of cumulative preferred stock in 2016, what total dividends should be paid to this stockholder in the fiscal year 2018, assuming Case B? Dividend paid

Explanation / Answer

1)Preferred dividend :2900*60*.25= 43500

B)

anlayze:dividend paid = 40*340 =$ 13600

Year Total dividend Preferred stock common stock Total Pershare Total per share 2016 5800 5800 5800/2900=2 0 0 2017 8700 8700 8700/2900=3 0 0 2018 333500 43500 43500/2900=15 333500-43500=290000 290000/145000=2

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