Reference no: EM132597533

A Corporation's share capital consists of 100,000 shares of preferred stock having a stated value of $15. The preferred dividends are $1 per share and they are in arrears for 2 years. The book value of the common shares is $2,250,000 with 50,000 shares issued. The current years dividends declared are $500,000.

Question a. What is the book value of the preferred shares?

Question b. What is the book value per share of the common shares?

Question c. How would you allocate the dividends under the following scenarios?

i. Preferred shares are non-cumulative and non-participating

ii. Preferred shares are cumulative and non-participating

iii. Preferred shares are non-cumulative and participating

iv. Preferred shares are cumulative and participating