Question

Exercise 14-02 a-c Sandhill Corporation was organized on January 1, 2019. During its first year, the corporation issued 2,050 shares of $50 par value preferred stock and 107,000 shares of $10 par value common stock. At December 31, the company declared the following cash dividends: 2019, $5,675; 2020, $13,500; and 2021, $28,000 Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 7% and noncumulative. 2019 2021 2020 Allocation to preferred stock Allocation to common stock SHOW LIST OF ACCOUNTS LINK TO TEXT Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 8% and cumulative. 2019 2020 2021 Allocation to preferred stock Allocation to common stock SHOW LIST OF ACCOUNTS LINK TO TEXT 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.) Debit Account Titles and Explanation Credit Date Dec. 31 Open Show Work this question:

Answer 1

Solution a:

Computation of dividend per share to Preferred and common shareholders
Year	Total Dividends (A)	Preferred dividend per year (B)	Preferred dividend paid ( C )	Common dividend paid ( D )(A - C)
2019	$5,675.00	$7,175.00	$5,675.00	$0.00
2020	$13,500.00	$7,175.00	$7,175.00	$6,325.00
2021	$28,000.00	$7,175.00	$7,175.00	$20,825.00

Solution b:

Computation of dividend per share to Preferred and common shareholders
Year	Total Dividends (A)	Preferred dividend per year (B)	Preferred dividend paid ( C )	Preferred dividend in arrear (D) (B - C)	Common dividend paid ( E )(A - C)
2019	$5,675.00	$8,200.00	$5,675.00	$2,525.00	$0.00
2020	$13,500.00	$8,200.00	$10,725.00	$0.00	$2,775.00
2021	$28,000.00	$8,200.00	$8,200.00	$0.00	$19,800.00

Solution c:

Journal Entries - Sandhill Corporation
Date	Particulars	Debit	Credit
31-Dec	Dividends Dr	$28,000.00
	To Dividend payable		$28,000.00
	(To record dividend declared)