A Share of Preferred Stock for Marshall Manufacturing Currently Sells

question 44

Multiple Choice

A share of preferred stock for Marshall Manufacturing currently sells for $120. It offers the investor a dividend rate of 8%, on a par value of $100. If the investor owns 500 shares, her total annual dividend will equal

• A) $800
• B) $8.00
• C) $2,000
• D) $4,000

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Definitions:

Physical Units Method

An inventory costing method that allocates costs based on the actual physical units of goods available for sale or use.

By-Product

A secondary product derived from the manufacturing process or chemical reaction that is incidental to the main product.

Joint Products

Products that are produced together from the same process or raw materials but are sold as separate items.

Joint Cost Allocation

The process of assigning the costs of a production process that yields multiple products to those products in a rational and consistent manner.