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Calculating the Dividend per Share

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Fritz Corporation has 800,000 shares of preferred stock and 1,800,000 shares of common stock. The cumulative preferred stock has a stated dividend of $2.50 per share. Under normal conditions, Kreisler pays out 30% of earnings available to common stockholders; however, because of a severe recession, Fritz retained all earnings last year. This year, Fritz earned net income of $6.4 million.

Calculate the dividend per share to be received by the common stockholders this year.

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Fritz Corporation has 800,000 shares of preferred stock and 1,800,000 shares of common stock. The cumulative preferred stock has a stated dividend of $2.50 per share. Under normal conditions, ...

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Manal Elkhoshkhany, MBA
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  • MBA, California State University, Sacramento
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