How much the preferred and common shareholders will receive

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Reference no: EM132920154

Predators Inc. has the following shares outstanding:

40,000, $ 0.80, no par value preferred shares $ 400,000

60,000 no par value common shares $ 600,000

All shares were sold for $ 10 each.

Dividends were last paid on December 31, 2017. It is now December 31, 2020, and the board of directors wants to distribute $ 204,000 in dividends.

Instructions

Problem 1: Calculate how much the preferred and common shareholders will receive under each of the following assumptions:

a) The preferred is noncumulative and non-participating.

b) The preferred is cumulative and non-participating.

c) The preferred is cumulative and fully participating.

d) The preferred is cumulative and participating up to 12% total.

Reference no: EM132920154

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