What is the cash distribution to common shareholders

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Problem - Urban Inc. had the following capital outstanding. In 2020, Urban Inc. distributes $80,000 in cash dividends to shareholders.

Common, $1 par, 30,000 shares issued and outstanding $30,000

8% Preferred, $10 par, 20,000 shares issued and outstanding 200,000

Required -

a. If the preferred stock is cumulative and dividends are in arrears for the past three years, what is the cash distribution to common shareholders and preferred shareholders?

b. What is the cash distribution to common shareholders and preferred shareholders if the preferred stock is noncumulative?

Reference no: EM132834551

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