A Corporation Has 10,000 Shares of 10%, $100 Par Noncumulative

question 24

Multiple Choice

A corporation has 10,000 shares of 10%, $100 par noncumulative preferred stock outstanding and 20,000 shares of no-par common stock outstanding. At the end of the current year, the corporation declares a dividend of $120,000. What is the dividend per share for preferred shares and for common shares?

• A)The dividend per share is $10.00 to preferred shares and $1.00 to common shares.
• B)The dividend per share is $6.67 to preferred shares and $1.00 to common shares.
• C)The dividend per share is $10.00 to preferred shares and $10 to common shares.
• D)The dividend per share is $50.00 to preferred shares and $1.00 to common shares.

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