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    Amount of dividends

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    Norton's outstanding stock consists of (a) 13,0000 shares of noncumulative 8% preferred stock with a $10 par value and (b) 32,500 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and paid the following total cash dividends.


    Determine the amount of dividends paid each year to each of the two classese of stockholders. Also compute the total dividends paid to each for the four years combined.

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    Solution Preview

    (a) Preferred stock - There are 13,000 shares of par value $10 and 8% dividend and non cumulative. The dividend amount each year would 13,000 X 10 X 8% = $10,400
    Preferred dividends have the first claim on ...

    Solution Summary

    The solution explains how to calculate the amount of dividends paid to preferred and common stockholders