Comparing Stock and Cash Dividends Carlos Company

had the following #2843

Comparing Stock and Cash Dividends Carlos Company had the following stock outstanding and
Retained Earnings at December 31, 2015:Common Stock (par $ 1; outstanding, 490,000
shares)………. $ 490,000Preferred Stock, 8% (par $ 10; outstanding, 19,000 shares)…….
190,000Retained Earnings………………………………………………. 966,000On December 31, 2015, the
directors is considering the distribution of a cash dividend to the common and preferred
stockholders. No dividends were declared during 2013 or 2014. Three independent cases are
assumed:Case A: The preferred stock is noncumulative; the total amount of 2015 dividends
would be $ 24,000.Case B: The preferred stock is cumulative; the total amount of 2015
dividends would be $ 24,000. Dividends were not in arrears prior to 2013.Case C: Same as
Case B, except the amount is $ 67,000.Required:Compute the amount of 2015 dividends, in
total and per share, payable to each class of stockholders for each case. Show computations.
Round per-share amounts to two decimal places.View Solution:
Comparing Stock and Cash Dividends Carlos Company had the following

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