Find how much will each shareholder group receive

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Athleetz, Inc., [AI] reported 2,000,000 no par common shares and 1,000,000 no par, $0.90 preferred shares authorized, on January 1, 2018. On the same date, 300,000 common shares [contributed capital $3,600,000] and 175,000 preferred shares [contributed capital $3,500,000] were outstanding.

Problem 1: However, now assume that for this question only, the preferred shares were cumulative and participating in excess distributable dividends after allocating common share holders a minimum dividend of $0.50 per share. How much will each shareholder group receive? [ROUND YOUR ANSWERS TO THE NEAREST $]

a. $490,394 to Preferred and $168,406 to Common.

b. $330,676 to Preferred and $328,124 to Common.

c. Each group receives an equal amount of $329,400 per group.

d. $630,000 to Preferred and $28,800 to Common.

e. None of the above.

Reference no: EM132973250

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