eBook

Question Content Area

Cornerstone Exercise 10-35 (Algorithmic) Preferred and Common Stock Dividends

Fancher Company has a single class of common stock and a single class of cumulative preferred stock. The cumulative preferred stock requires the corporation to pay an annual dividend of $3,750 to preferred stockholders. On January 1, 2019, Fancher's preferred dividends were 1 year in arrears, which means that Fancher declared neither preferred nor common dividends in 2018. During the next 3 years (20192021), Fancher's board of directors determined they would be able to pay $5,000, $7,000, and $12,000, respectively.

Required:

Show how these anticipated payments will be split between preferred and common stockholders. If an amount box does not require an entry, leave it blank and if the answer is zero, enter "0".

Year	Amount Available for Dividends	Dividends to Preferred	Dividends to Common	Remaining in Arrears
2018	$fill in the blank 1	$fill in the blank 2	$fill in the blank 3	$fill in the blank 4
2019	$fill in the blank 5	$fill in the blank 6	$fill in the blank 7	$fill in the blank 8
2020	$fill in the blank 9	$fill in the blank 10	$fill in the blank 11	$fill in the blank 12
2021	$fill in the blank 13	$fill in the blank 14	$fill in the blank 15	$fill in the blank 16