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2010-06-12_083526_verg_3-1

2010-06-12_083526_verg_3-1 - Prob 111A 1 Preferred...

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Prob. 11–1A 1. Preferred Dividends Common Dividends Total Year Dividends Total Per Share Total Per Share 2003 ....................... $ 21,000 $21,000 $ 2.10 $ 0 $0 2004 ....................... 50,000 30,000 3.00 20,000 0.20 2005 ....................... 15,000 15,000 1.50 0 0 2006 ....................... 80,000 30,000 3.00 50,000 0.50 2007 ....................... 90,000 30,000 3.00 60,000 0.60 2008 ....................... 140,000 30,000 3.00 110,000 ........................ 1.10 $15.60 $2.40 2. Average annual dividend for preferred: $2.60 per share ($15.60/6) Average annual dividend for common: $0.40 per share ($2.40/6) 3. a. 3.25% ($2.60/$80) b. 4.0% ($0.40/$10) Prob. 11–3A a. Cash (12,000 × $62) ........................................................ 744,000 Common Stock (12,000 × $40) ................................. 480,000 Paid-In Capital in Excess of Par—Common Stock (12,000 × $22) ................................................. 264,000 b. Cash (5,000 × $124) ........................................................ 620,000 Preferred Stock (5,000 × $100) ................................. 500,000 Paid-In Capital in Excess of Par—Preferred Stock (5,000 × $24) ................................................... 120,000 c. Treasury Stock
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