Date 25-07-20 Particulars Dividend Payable on Preferred Stock Dividend Payable on Common Stock Bank Account Dr...

 

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Date 25-07-20 Particulars Dividend Payable on Preferred Stock Dividend Payable on Common Stock Bank Account Dr Rs. 700,000 Rs. 88,000 Cr Rs. 788,000 P.5-2 Shadman Trading Company had 10,000 shares of 10% Preferred Stock of Rs. 100 each and 80,000 shares of Rs. 10 par value outstanding for last several years. During 2019 and 2020 the profits earned totaled Rs. 60,000 and Rs. 216,000 for each year respectively. A) Preferred Stock is cumulative and non- participating. B) Preferred Stock is non-cumulative and participating. Required Compute the amount of dividends that must have been paid to the Preferred and Common Stockholders each year based upon the following independent assumptions:- Date 25-07-20 Particulars Dividend Payable on Preferred Stock Dividend Payable on Common Stock Bank Account Dr Rs. 700,000 Rs. 88,000 Cr Rs. 788,000 P.5-2 Shadman Trading Company had 10,000 shares of 10% Preferred Stock of Rs. 100 each and 80,000 shares of Rs. 10 par value outstanding for last several years. During 2019 and 2020 the profits earned totaled Rs. 60,000 and Rs. 216,000 for each year respectively. A) Preferred Stock is cumulative and non- participating. B) Preferred Stock is non-cumulative and participating. Required Compute the amount of dividends that must have been paid to the Preferred and Common Stockholders each year based upon the following independent assumptions:-

Answer rating: 100% (QA)

A Preferred Stock is cumulative and non participating Preferred Stock Dividend Rate 10 Par Value Rs1... View the full answer