Bob Wright ​

question 2

Short Answer

Bob Wright
​
Bob Wright owned 100 shares of Lawson Company's convertible preferred stock at $10 par value. He converted each share of preferred stock into three shares of common stock.
​
-Refer to Bob Wright. If the convertible preferred stock paid 7% annually and the common stock pays $0.40 a share this year, how much more dividend will Bob Wright receive this year because of his conversion?​

Recognize the conditions that render a note negotiable.

Identify the extent of liability for payment on a negotiable instrument.

Comprehend the implications of being primarily or secondarily liable on a negotiable instrument.

Grasp the conditions under which a delay in payment or refusal to pay constitutes dishonor of an instrument.

---

Definitions:

Non-Cumulative

Pertaining to preferred stock, which does not accumulate unpaid dividends if they are not declared.

Preferred Stock

A class of ownership in a corporation that has a higher claim on its assets and earnings than common stock, often with fixed dividends.

Treasury Stock

Shares that were issued and subsequently reacquired by the issuing corporation, reducing the number of shares outstanding in the market.

Gain On Sale

The profit realized from the sale of an asset, when the selling price exceeds its original purchase price.