Questions -
1. On May 15th, S issued 5,000 shares of cumulative, 10% preferred stock, with a par value of $100 for $112 per share. Prepare the entry.
2. A subsidiary of S had outstanding, at the end of the year, 10,000 shares of common stock outstanding and 5,000 shares of cumulative/non-participating preferred stock. S wants to issue cash dividends totaling $80,000. Calculate how much goes to preferred stock holders and common stock holders. Par value of the 10%, preferred stock is $100. There are no dividends in arrears.