Zepher, Inc., prepared the following stockholders' equity section as of December 31, 2016. Answer the following questions
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Zepher, Inc., prepared the following stockholders' equity section as of December 31, 2016.
Answer the following questions about Zepher, Inc.'s dividends:
1. How much in dividends must Zepher, Inc., declare each year before the common stockholders get any cash dividends for the year?
2. Suppose Zepher, Inc., declares cash dividends of $22,000 for 2016. How much of the dividends goes to preferred? How much goes to common?
3. Is Zepher, Inc.'s preferred stock cumulative or noncumulative? How can you tell?
4. Suppose Zepher, Inc., passed the preferred dividend in 2014 and 2015. In 2016, the company declares cash dividends of $19,000. How much of the dividends goes to preferred? How much goes to common?
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...
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