Dividends Were Not Declared by Royal Inc

question 66

Multiple Choice

Dividends were not declared by Royal Inc.in 2015 or 2016.During 2017,total dividends declared amount to $20,000.There are 6,000 shares of $1 cumulative preferred shares outstanding and 10,000 common shares outstanding.The total amount of dividends payable to each class of shares in 2017 amounts to:

• A) $18,000 to preferred, $2,000 to common
• B) $6,000 to preferred, $14,000 to common
• C) $12,000 to preferred, $8,000 to common
• D) $10,000 to preferred, $10,000 to common

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Definitions:

Current Ratio

A financial metric used to assess a company's ability to pay off its short-term liabilities with its short-term assets.

Year-End Balance Sheet

A financial statement that shows a company's assets, liabilities, and equity at the last day of the fiscal year, providing a snapshot of its financial condition.

Data

Information collected and used for analysis or decision making, often in a structured form.

Common Size Percentages

Ratios used in financial analysis that express each line item on a financial statement as a percent of a base amount, facilitating comparison.