Occidental Produce Company Has 40,000 Shares of Common Stock Outstanding

question 153

Multiple Choice

Occidental Produce Company has 40,000 shares of common stock outstanding and 2,000 shares of preferred stock outstanding. The common stock is $0.01 par value; the preferred stock is 4% non-cumulative, with $100 par value. On October 15, 2014, the company declares a total dividend payment of $40,000.
-How much dividend will be paid to the preferred shareholders?

• A) $40,000
• B) $2,000
• C) $8,000
• D) $4,500

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Definitions:

Domestic Output

The total value of all goods and services produced within the borders of a country within a specific period.

Before-Tax Household Income

The total income earned by all members of a household before any taxes are deducted.

Percent

A way to express a number as a fraction of 100, denoting proportions or ratios.