Aztec Industries Has 100,000 Common Shares Outstanding and 10,000 $2

question 24

Essay

Aztec Industries has 100,000 common shares outstanding and 10,000 $2 cumulative preferred shares. If the company does not declare any dividends in Year 1 but declares a total dividend of $45,000 in Year 2, how much will be distributed to preferred and common shareholders?

---

Definitions:

Corporate Charter

A legal document establishing a corporation, outlining its structure, and defining its rights and duties.

Corporate Board

A group of individuals elected by shareholders to oversee and make decisions on behalf of a corporation.

S-corp

A special designation for a corporation in the United States that allows profits and losses to be passed through to shareholders to avoid double taxation on corporate income.

C-corp

A type of corporation in the United States that is taxed separately from its owners, as defined under subchapter C of the Internal Revenue Code.