Digits Inc.

has outstanding 300,000 shares of P2 par ordinary share and 60,000

shares of no-par 8% preference share with a stated value of P5. The preference
share is cumulative and nonparticipating. Dividends have been paid in every year
except the past two years and the current year. Assuming that P150,000 will be
distributed as a dividend in the current year, how much will the ordinary
shareholders receive?
a. 102,000 c. 126,000
b. 78,000 d. 0

JCS Inc. has 560,000 shares of P10 par value common stock outstanding. During
the year, JCS declared a 5% stock dividend when the market price of the stock
was P48 per share. Two months later JCS declared a P0.60 per share cash
dividend. As a result of the dividends declared during the year, retained earnings
decreased by:
a. 1,696,800 c. 1,344,000
b. 352,800 d. 336,000

Welcoat Co. has outstanding 50,000 shares of 8% preference share with a P10
par value and 125,000 shares of P3 par value ordinary share. Dividends have been
paid every year except last year and the current year. If the preference share is
cumulative and nonparticipating and P250,000 is distributed, the ordinary
shareholders will receive
a. 250,000 c. 170,000
b. 210,000 d. 0