Love Theater Inc. owns & operates movie theaters throughout New Mexico & Utah. Love Theatre has declared the following annual dividends over a 6 year period: 2007, $32,000; 2008,$96,000; 2009, $160,000; 2010, $192,000, 2011, $240,000; 2012, $296,000. During the entire period ending Dec 31 of each year, the OUTSTANDING STOCK of the company was composed of 20,000 shares of cumulative 40% preferred stock, $100 par, & 100,000 shares of common stock, $25 par.
(a)Calculate the total dividends & per share dividends declared on each class of stock for each of the 6 yeas. There were no dividends in arrears on Jan 1, 2007. Summarize data in tabular form.
(b)Calculate the average annual dividend per share for each class of stock for 6 year period.
(c) Assuming a market price per share of $288 for the preferred stock & $31 for the common stock, calculate the average annual percentage return on initial shareholders investment, based on the average annual dividend per share for preferrd stock & for common stock.