The Surf's Up Issues 1,000 Shares of 6%, $100 Par

question 82

Multiple Choice

The Surf's Up issues 1,000 shares of 6%, $100 par value preferred stock at the beginning of 2011. All remaining shares are common stock. The company was not able to pay dividends in 2011, but plans to pay dividends of $18,000 in 2012. Assuming the preferred stock is noncumulative, how much of the $18,000 dividend will be paid to preferred stockholders and how much will be paid to common stockholders in 2012?

• A) $6,000 to preferred stockholders and $12,000 to common stockholders.
• B) $18,000 to preferred stockholders and $0 to common stockholders.
• C) $12,000 to preferred stockholders and $6,000 to common stockholders.
• D) $9,000 to preferred stockholders and $9,000 to common stockholders.

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Definitions:

Causes

Factors or conditions that bring about an effect or a change.

Abnormal Behavior

Patterns of emotion, thought, and action deemed pathological for being statistically unusual, violating norms, or causing distress and functional impairment.

Psychologists

Professionals who study mental processes and behavior, often conducting research, assessments, and therapy to understand and improve psychological well-being.

Psychological Disorders

Patterns of behavioral, cognitive, emotional, or physical symptoms that lead to distress, disability, or significant risk of harm, classified and described in diagnostic manuals such as the DSM and ICD.