A corporation with both preferred stock and common stock outstanding has a substantial credit balance in its retained earnings account at the beginning of the current fiscal year. Although net income for the current year is sufficient to pay the preferred dividend of $250,000 each quarter and a common dividend of $610,000 each quarter, the board of directors declares dividends only on the preferred stock. Suggest possible reasons for passing the dividends on the common stock.
Answer to relevant QuestionsA corporation reacquires 8,000 shares of its own $10 par common stock for $120,000, recording it at cost. (a) What effect does this transaction have on revenue or expense of the period? (b) What effect does it have on ...The important dates in connection with a cash dividend of $48,000 on a corporation's common stock are July 16, August 15, and September 30. Journalize the entries required on each date.Using the following accounts and balances, prepare the Stockholders’ Equity section of the balance sheet. Fifty thousand shares of common stock are authorized, and 5,000 shares have been reacquired.Common Stock, $75 par ...Country Sounds Corp., an electric guitar retailer, was organized by Julie Arnold, Joe Harris, and Scott Pickens. The charter authorized 500,000 shares of common stock with a par of $12. The following transactions affecting ...The following accounts and their balances appear in the ledger of Heart and Saul Inc. onApril 30 of the current year:Common Stock, $50 par ........... $ 900,000Paid-In Capital in Excess of Par ........ 110,000Paid-In ...
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