Question 1: Common stock-calculate issue price and dividend amount
The balance sheet for common stock is the following:
Common stock without par value, 2,000,000 shares authorized,
400,000 shares issued, and 360,000 shares outstanding - $2,600,000
Required:
a. Calculate the average price at which the shares were issued.
b. If these shares had been assigned at stated value of $1 each, show how the caption here would be different.
c. If a cash dividend of $0.60 per share were declared, calculate the total amount of cash that would be paid to stockholders.
d. What accounts for the difference between issued shares and outstanding shares?
Question 2: Preferred stock-calculate dividend amounts. Calculate the cash dividends required to be paid for each of the following preferred stock issues:
Required:
a. The semiannual dividend on 6% cumulative preferred, $50 par value, 30,000 shares authorized, issued, and outstanding.
b. The annual dividend on $3.60 cumulative preferred, 400,000 shares authorized, 180,000 shares issued, 148,200 outstanding. Last year's dividend has not been paid.
c. The quarterly dividend on 7.5% cumulative preferred, $100 stated value, $103 liquidating value, 120,000 shares authorized, 112,000 shares issued and outstanding. No dividends are in arrears.