After Payment of All Claims Apart from Payments to Capital

question 14

Multiple Choice

After payment of all claims apart from payments to capital contributors, the liquidator prepared the following statement of shareholders' equity for Train Ltd:
$\begin{array}{llcc} \text { Preference shares \( (20000) \) } &40000 \\ \text { Ordinary shares (100 000) } &300000\\ \text {Accumulated losses } &\underline{(155000) }\\ \text { Total} &185000\\\end{array}$

There is $125 000 cash remaining for distribution and all shares are fully paid.What is the dividend per preference share if preference shareholders rank equally with ordinary shareholders? (Note: Round amounts to nearest cent.)

• A)$6.25
• B)$0.50
• C)$1.04
• D)$9.25

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Definitions:

Market Pricing

A social exchange theory concept where relationships are evaluated based on cost-benefit analysis and equitable distribution.

Communal Sharing

A form of social relation where members of a group treat group belongings as a collective resource, emphasizing equality and shared identity.

Thoracic Cavity

The area of the human body located between the neck and the abdomen, housing organs such as the heart, lungs, esophagus, and major blood vessels.

Abdominal Cavity

The largest body cavity in humans, housing many vital organs, including the stomach, liver, and intestines, enclosed by the abdominal muscles and the pelvis.