Calculate the Cash Dividends Required to Be Paid for Each

question 31

Essay

Calculate the cash dividends required to be paid for each of the following preferred stock issuances:
(a.) The semiannual dividend on 11.5% cumulative preferred, $100 par value; 12,000 shares authorized, issued, and outstanding.
(b.) The total dividends owed to preferred shareholders on $1.50 annual cumulative preferred, 200,000 shares authorized, 170,000 shares issued, and 162,700 shares outstanding. The company did not pay dividends during the prior two years or during the current year.
(c.) The quarterly dividend on 9.5% cumulative preferred, $70 stated value, $72 liquidating value, 40,000 shares authorized, 30,000 shares issued and outstanding. No dividends in arrears.

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Definitions:

Import Substitution

A development strategy that emphasizes domestic manufacturing of products that were imported.

Consumer Surplus

The difference between the total amount that consumers are willing and able to pay for a good or service and the total amount they actually pay.

National Security

National security involves the safety and defense of a nation, including its citizens, economy, and institutions, protected against threats ranging from terrorism to foreign invasions.

Infant Industries

Newly established industries often with limited capabilities compared to established competitors, and potentially protected by a government until they become competitive.