Wilson Corporation issued and has outstanding 145000 shares

Wilson Corporation issued and has outstanding 145,000 shares of $10 par-value common stock and 2,900 shares of $60 par-value 25 percent preferred stock. The board of directors votes to distribute $5,800 as dividends in 2016, $8,700 in 2017, and $333,500 in 2018 Compute the total dividend and the dividend for each share paid to preferred stockholders and common stockholders each year under the following assumed situations. Case A: The preferred stock is nonparticipating and noncumulative. (Round your per share answers to 2 decimal places.) Total Preferred Stock Common Stock Year TotalPer ShareTota Per Share 2016 S 5,800 S 5,800 2017 2018 0 S 10.00 2.50 43,500 290,000.00 290,000 290,000.00 43,500.00 8,700 145,000.00 8,700 333,500 Case B: The preferred stock is cumulative and nonparticipating. (Round your per share answers to 2 decimal places.) Total Preferred Stock Common Stock Year TotalPer ShareTota Per Share 2016 S 5,800 S 5,800 43,500.00 2017 8,700 8,700 15.00 2018 333,500 43,500 29,000.00 290,000 Analyze: If a stockholder purchased 340 shares of cumulative preferred stock in 2016, what total dividends should be paid to this stockholder in the fiscal year 2018, assuming Case B? Dividend paid

Solution

1)Preferred dividend :2900*60*.25= 43500

B)

anlayze:dividend paid = 40*340 =$ 13600

Year	Total dividend	Preferred stock	common stock
		Total	Pershare	Total	per share
2016	5800	5800	5800/2900=2	0	0
2017	8700	8700	8700/2900=3	0	0
2018	333500	43500	43500/2900=15	333500-43500=290000	290000/145000=2