Sabas Company Has 40,000 Shares of $100 Par, 1% Preferred $\begin{array}{lr}\text { Year 1: } & \$ 50,000 \\\text { Year 2: } & 90,000 \\\text { Year 3: } & 130,000\end{array}$

question 57

Essay

Sabas Company has 40,000 shares of $100 par, 1% preferred stock and 100,000 shares of $50 par common stock issued and outstanding. The following amounts were distributed as dividends: $\begin{array}{lr}\text { Year 1: } & \$ 50,000 \\\text { Year 2: } & 90,000 \\\text { Year 3: } & 130,000\end{array}$ ​
Determine the dividends per share for preferred and common stock for each year.

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Definitions:

Partial Certainty

This refers to a scenario in business or decision-making where there is some known information, but complete certainty about outcomes is not possible, reflecting a mix of known and unknown variables.

Expected Outcome

The anticipated result of an action, decision, or event, based on current knowledge, probabilities, and reasoning.

Utility

In economics, the satisfaction or benefit derived by consuming a product or service.

Insurance Policy

A contract between an insurer and a policyholder in which the insurer agrees to compensate the policyholder for loss or damage specified in the policy, in exchange for premiums paid by the policyholder.