# Mega, Inc., has common and 6 percent preferred stock outstanding as follows: Preferred stock: 10,000 shares, \$100 par value, cumulative

## Question:

Mega, Inc., has common and 6 percent preferred stock outstanding as follows:
Preferred stock: 10,000 shares, \$100 par value, cumulative
Common stock: 50,000 shares, \$50 par value
The company declares a total dividend of \$200,000. If the dividends on preferred stock are one year in arrears (in addition to the current year), how will the total dividend be divided between the common and preferred stock?

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,...

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Related Book For

## Financial and Managerial Accounting the basis for business decisions

ISBN: 978-0078111044

16th edition

Authors: Jan Williams, Susan Haka, Mark Bettner, Joseph Carcello

Question Details
Chapter # 11
Section: Brief Exercises
Problem: 4
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Question Posted: April 17, 2014 09:53:15