Week 5-#1-Stk Mkt Trans-1.-f10

Week 5-#1-Stk Mkt Trans-1.-f10 - Participating Preferred...

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Unformatted text preview: Participating Preferred Example Example: - $1,000,000 net profit - 50% dividend rate - 50,000 shares of 10% cumulative participating preferreds with $10 par value - dividends in arrears 1 yr. - participation commences when common dividends reach $3/share - 100,000 shares common stock What is the amount of dividends per share for both common and preferred? $500,000 total dividend ($1,000,000 x 50%)- $100,000 preferred dividend (10% x $10 par x 2 years = $2/share x 50,000 shares) $400,000 - $300,000 common dividend (100,000 shares x $3) $100,000 for participation / 150,000 shares (50,000 pref. + 100,000 common) ~ $.67 per share Thereforepreferred dividend = $2.67/share common dividend = $3.67/share Stock Market Transactions We will be examining the following types of transactions that can be made by investors in the organized stock exchanges (and the stock market competition) Straight Buys/Straight Sells Market orders Short Selling Buying Stock on Margin Stock Options Puts and Calls Straight Buys and Straight Sells The most common types of transactions in...
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Week 5-#1-Stk Mkt Trans-1.-f10 - Participating Preferred...

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