Question

Question 15

Oriole Corporation was organized on January 1, 2019. During its first year, the corporation issued 2,100 shares of $50 par value preferred stock and 100,000 shares of $10 par value common stock. At December 31, the company declared the following cash dividends: 2019, $6,350; 2020, $14,500; and 2021, $29,000.

Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 7% and noncumulative.

		2019		2020		2021
Allocation to preferred stock		$		$		$
Allocation to common stock		$		$		$

Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 9% and cumulative.

		2019		2020		2021
Allocation to preferred stock		$		$		$
Allocation to common stock		$		$		$

Journalize the declaration of the cash dividend at December 31, 2021, under part (b). (Credit account titles are automatically indented when amount is entered. Do not indent manually. If no entry is required, select "No Entry" for the account titles and enter 0 for the amounts.)

Date	Account Titles and Explanation	Debit	Credit
Dec. 31

Answer 1

1)	7% and non cumulative
	2100*50*7%
	7350
				2019	2020	2021
	Allocation to preferred stock			6,350	7,350	7,350
	Allocation to common stock			0	7,150	21,650
2)	9% and cumulative
	2100*50*9%
	9450
				2019	2020	2021
	Allocation to preferred stock			6,350	12,550	9,450
	Allocation to common stock			0	1,950	19,550
Date	Account titles and explanation				debit	Credit
31-Dec	Cash dividend				29000
	dividends payable					29000