Slickers, Inc

question 69

Multiple Choice

Slickers, Inc. had the following capital structure during 2014: Preferred stock, 7%, $50 par value, 1,000 shares issued and outstanding with dividends in arrears for 2012 and 2013.
Common stock, $100 par value, 2,000 shares issued and outstanding.
The total dividends declared and paid during 2014 totaled $25,000. How much of the dividend is paid to the common stockholders during 2014 assuming the preferred stock is noncumulative?

• A) $3,500.
• B) $7,000.
• C)$21,500.
• D)$14,500.

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Definitions:

Return On Equity

A measure of a corporation's profitability that reveals how much profit a company generates with the money shareholders have invested.

Income Statement

A financial report that shows a company's revenues, expenses, and profits over a specified period.

Compound Leverage Ratio

A measure that assesses the impact of financial leverage on a company's potential returns, taking into account both debt and equity levels.

Income Statement

A financial statement that shows a company's revenues and expenses over a specific period of time, revealing profit or loss.