Rhinehart Corporation had both common stock and preferred stock outstanding from 2012 through 2014. Information about each
Question:
Rhinehart Corporation had both common stock and preferred stock outstanding from 2012 through 2014. Information about each stock for the three years follows.
The company paid $140,000, $800,000, and $1,100,000 in dividends for 2012 through 2014, respectively. The market price per common share was $15 and $17 per share at the end of years 2013 and 2014, respectively.
Required
1. Determine the dividends per share and total dividends paid to the common and preferred stockholders each year. (Round to the nearest cent.)
2. Assuming that the preferred stock was noncumulative, repeat the computations per-formed in requirement 1. (Round to the nearest cent.)
3. Calculate the 2013 and 2014 dividend yield for common stock using dividends per share computed in requirement 2. (Round to the nearest tenth of a percent.)
4. How are cumulative preferred stock and noncumulative preferred stock similar to long-term bonds? How do they differ from long-term bonds?
Common StockCommon 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...
Step by Step Answer:
Principles of Accounting
ISBN: 978-1133626985
12th edition
Authors: Belverd E. Needles, Marian Powers and Susan V. Crosson