Infomatics, Inc. has 60,000 shares of $3 par value common stock and 9,000 shares of 8%, $20 par value preferred stock

Question

Infomatics, Inc. has 60,000 shares of $3 par value common stock and 9,000 shares of 8%, $20 par value preferred stock outstanding at December 31, 2020. On January 1, 2021, the board of directors declares a $71,000 dividend. No dividends were paid in 2019 or 2020 Determine the amount of the $71,000 dividend that will be paid to the preferred stockholders and to the common stockholders in 2021 under two independent assumptions: 1. The preferred stock is noncumulative. 2. The preferred stock is cumulative. Dividend Paid to Preferred Stockholders Dividend Paid to Common Stockholders 1 Preferred stock is noncumulative 2 Preferred stock is cumulative

Help In Homework · Accepted Answer

Dividend paid to Dividend paid to Preferred Stockholders Common Stockholders 1 Preferred stock is non cumulative 14400 56600 2 Preferred stock is cumulative 43200 27800 (14400*3) Dividend to Preferred Shareholders for one year 9000*20*8% 14400

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Infomatics, Inc

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Archived Solution

	Dividend paid to	Dividend paid to
		Preferred Stockholders	Common Stockholders
1	Preferred stock is non cumulative	14400	56600
2	Preferred stock is cumulative	43200	27800
		(14400*3)

	Dividend to Preferred Shareholders for one year	9000208%	14400