Reference no: EM132612291

Question - Cheyenne Corporation issued 180,000, $4.00 cumulative preferred shares to fund its first investment in wind generators. In its first year of operations, it paid $452,000 of dividends to its preferred shareholders. In its second year, the company paid dividends of $988,000 to its preferred shareholders.

Required -

a) What is the total annual preferred dividend supposed to be for the preferred shareholders?

b) Calculate any dividends in arrears in years 1 and 2.

c) If the preferred shares were noncumulative rather than cumulative, how much dividend would the company likely have paid its preferred shareholders in year 2?