Question

Required information Use the following information for the Exercises below. {The following information applies to the questions displayed below.) York's outstanding stock consists of 60,000 shares of noncumulative 70% preferred stock with a $5 par value and also 210,000 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and paid the following total cash dividends. $ Year 1 total cash dividends Year 2 total cash dividends Year 3 total cash dividends Year 4 total cash dividends 10,900 19,000 205,000 355.000 Exercise 11-10 Dividends on common and noncumulative preferred stock LO C2 Determine the amount of dividends paid each year to each of the two classes of stockholders: preferred and common (Round y "Dividend per Preferred Share" answer to 3 decimal places.) Par Value per Preferred Share Dividend Rate Dividend per Number of preferred Preferred Preferred Share Shares Dividend Annual Preferred Dividend: Total Cash Dividend Paid Paid to Preferred Paid to Common Dividends in Arrears at year-end Year 1 Year 2 Year 3 10,900 19.000 205.000 355.000 Year 4 Total: 589.900

Answer 1

• Exercise 11-10

	Par Value per Preferred Share	Dividend rate	Dividend per Preferred Share	No. of Preferred Shares	Preferred Dividend
Annual Preferred Dividend:	$                             5	7.00%	$                   0.350	60,000	$            21,000.00
	Total Cash Dividend paid	Paid to Preferred	Paid to Common	Dividends in Arrears at Year end
Year 1	$            10,900.00	$           10,900.00	$                          -	$          10,100.00 or $ 0
Year 2	$            19,000.00	$           19,000.00	$                          -	$          12,100.00 or $ 0
Year 3	$          205,000.00	$           21,000.00	$        184,000.00	$                          -
Year 4	$          355,000.00	$           21,000.00	$        334,000.00	$                          -
TOTAL	$          589,900.00	$           71,900.00	$        518,000.00	$                          -

• Exercise 11-7

Requirement 1

Stockholder's equity section
Common Stock (222000 shares)	$740,000
Paid in Capital in excess of Par - Common Stock	$320,000
Retained earnings	$720,000
Total Stockholder's equity	$1,780,000

Requirement 2

No of shares outstanding = 74000 shares x 3/1 = 222000 shares