Question

Hodge Corporation issued 100,000 shares of $20 par value, cumulative, 6% preferred stock on January 1, 2013, for $2,300,000. In December 2015, Hodge declared its first dividend of $500,000.

Instructions
(a) Prepare Hodge’s journal entry to record the issuance of the preferred stock.
(b) If the preferred stock is not cumulative, how much of the $500,000 would be paid to common stockholders?
(c) If the preferred stock is cumulative, how much of the $500,000 would be paid to common stockholders?



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  • CreatedJanuary 30, 2014
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