Question 1198796: Hello, my subject is investments hopefully I found the right section.
My problem is: Calculate the preferred and common dividend per share (in $) for the company. (If there is no answer, enter NONE.)
Common stock shares: 8,000,000
Preferred stock: Shares: 1,000,000. Div or Par: $100, 6%. Cum: No.
Dividend: 5,000,000
Declared arrears: None
Preferred Div./Share:
Common Div./Share:
Answer by textot(100)   (Show Source):
You can put this solution on YOUR website! **1. Calculate Preferred Dividend per Share**
* **Preferred Dividend per Share = Par Value * Dividend Rate**
* Preferred Dividend per Share = $100 * 6% = $6.00
**2. Calculate Total Preferred Dividend**
* Total Preferred Dividend = Preferred Dividend per Share * Number of Preferred Shares
* Total Preferred Dividend = $6.00 * 1,000,000 = $6,000,000
**3. Calculate Available Dividend for Common Stock**
* Available Dividend for Common Stock = Total Dividend - Total Preferred Dividend
* Available Dividend for Common Stock = $5,000,000 - $6,000,000 = -$1,000,000
**4. Calculate Common Dividend per Share**
* Since the Available Dividend for Common Stock is negative, there is **no dividend available for common stockholders**.
**Therefore:**
* **Preferred Div./Share:** $6.00
* **Common Div./Share:** NONE
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