Seacrest company has 25,000 shares of cumulative preferred 1% stock, $150 par and 50,000 shares of $10 par common stock. the following amounts were distributed as dividends: year 1 $75,000 year 2 30,000 year 3 112,500 determine the dividends per share for preferred and common stock for each year. round all answers to two decimal places. if an answer is zero, enter '0'.

for 1st year  dividend per equity share = $0.75

for 2nd year 0

for 3rd year dividend per equity share = $1.35

Explanation:

given data

share = 25000

cumulative preferred stock = 1%

par value = $150

share = 50000

common stock = $10

to find out

Determine the dividends per share for preferred and common stock for each year

solution

for 1st year

dividends amount  Year 1 =  $75,000

so total Preferred dividend to be paid = 150 × 1% × 25000

total preferred dividend = $37500

so dividend per share =

dividend per share = $1.5

so remaining dividend after payment of preferred dividend is

dividend after payment of preferred dividend = 75000 - 37500

dividend after payment of preferred dividend = $37500

so dividend per equity share will be

dividend per equity share =

dividend per equity share = $0.75

and

for 2nd year

dividends amount  Year 2 =  $30,000

and total preferred dividend = $37500

so dividend per share will be =

dividend per share = $1.2

so since the preferred stock cumulative dividend to be paid in next year due to less payment

remaining dividend = 30000 - 37500 = - 7500

so current yeas will be $ 0.3 per share or $7500

so remaining dividend is 0

and

for 3rd year

dividends amount  Year 3 =  $112,500

total dividend paid to preferred stock = 37500 + 7500 = $45000

so preferred dividend per share =

preferred dividend per share =- $1.8

remaining dividend = 112,500 - 45000 = $67500

so dividend per equity share =  

dividend per equity share = $1.35