McNabb Corp. had $100,000 of 7%, $20 par value preferred stock and 12,000 shares of $25 par

Question:

McNabb Corp. had $100,000 of 7%, $20 par value preferred stock and 12,000 shares of $25 par value common stock outstanding throughout 2011.

(a) Assuming that total dividends declared in 2011 were $64,000, and that the preferred stock is not cumulative but is fully participating, common stockholders should receive 2011 dividends of what amount?

(b) Assuming that total dividends declared in 2011 were $64,000, and that the preferred stock is fully participating and cumulative with preferred dividends in arrears for 2010, preferred stockholders should receive 2011 dividends totaling what amount?

(c) Assuming that total dividends declared in 2011 were $30,000, that the preferred stock is cumulative, nonparticipating and was issued on January 1, 2010, and that $5,000 of preferred dividends were declared and paid in 2010, the common stockholders should receive 2011 dividends totaling what amount?

Common Stock
Common stock is an equity component that represents the worth of stock owned by the shareholders of the company. The common stock represents the par value of the shares outstanding at a balance sheet date. Public companies can trade their stocks on... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...