The board of directors of Picasso Manufacturing, Inc , may declare a dividend this year but has not declared a dividend for the past two years The corporation has 800,000 shares of $ 1 par value common stock authorized and 200,000 shares issued and outstanding It also has 40,000 shares of 5 percent...

The board of directors of Picasso Manufacturing, Inc., may declare a dividend this year but has not

Question:

The board of directors of Picasso Manufacturing, Inc., may declare a this year but has not declared a for the past two years. The has 800,000 shares of $ 1 authorized and 200,000 shares issued and outstanding. It also has 40,000 shares of 5 percent, $ 10 cumulative preferred stock authorized, of which 40,000 shares are issued and outstanding. Compute the amount of dividends available for common and preferred shareholders if the declaration is $ 80,000.
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... Corporation
A Corporation is a legal form of business that is separate from its owner. In other words, a corporation is a business or organization formed by a group of people, and its right and liabilities separate from those of the individuals involved. It may... Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their... 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,...