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Reptile [31]
2 years ago
13

Lightfoot Inc., a software development firm, has stock outstanding as follows: 30,000 shares of cumulative preferred 2% stock, $

25 par, and 38,000 shares of $75 par common. During its first four years of operations, the following amounts were distributed as dividends: first year, $5,700; second year, $9,600; third year, $59,720; fourth year, $117,220.
Mathematics
1 answer:
Lesechka [4]2 years ago
6 0

The calculation of the dividends per share on each class of stock for each of the four years for Lightfoot Inc. are:

                                 1st Year       2nd Year       3rd Year      4th Year

Preferred stock          $0.19            $0.32            $0.99          $0.50

Common stock           $0                 $0                $0.79          $2.69

How is dividend per share calculated?

The dividend per share for each class of stock can be computed by dividing the total dividend distributed by the number of shares outstanding.

For cumulative preferred stock, the unpaid dividends in a year are carried forward for distribution when profits are made.  Note also that preferred stock dividends enjoy preferential payment before common stock dividends.

<h3>Data and Calculations:</h3>

Cumulative preferred stock = 30,000 shares

Par value of preferred stock = $25

Dividend rate = 2%

The total value of preferred stock = $750,000 ($25 x 30,000)

Expected annual dividend for preferred stockholders = $15,000 ($750,000 x 2%)

Common stock = 38,000 shares

Par value of common stock = $75

The total value of ordinary stock = $2,850,000 ($75 x 38,000)

<h3>Dividends distribution:</h3>

                                        1st Year       2nd Year       3rd Year      4th Year

Dividends distributed    $5,700           $9,600       $59,720       $117,220

Preferred stock             $5,700            $9,600      $29,700        $15,000

Preferred stock per share $0.19           $0.32        $0.99             $0.50 ($15,000/30,000)

Common stock                  $0                   $0         $30,020      $102,220

Common stock per share $0                  $0            $0.79           $2.69 ($102,220/38,000)

Thus, the dividends distribution of Lightfoot Inc. shows that the common stockholders started earning dividends after the second year.

Learn more about cumulative preferred stock dividends at brainly.com/question/14006397

#SPJ1

<h3>Question Completion:</h3>

Calculate the dividends per share on each class of stock for each of the four years. Round all answers to two decimal places. If no dividends are paid in a given year, enter "O."

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  • Similar = Yes, they are similar
  • How:  AA similarity
  • Similarity statement:  triangle HGF ~ triangle HMN

The ~ mark means "similar"

=====================================================

The red angle markings tell us which angles are congruent to one another. We have these two pairs of congruent angles

  • angle H = angle H (both triangles unfortunately reuse H) by the single arc marking
  • angle G = angle M, by the double arc markings

Because we have two pairs of congruent angles, we use the AA similarity theorem. AA stands for angle angle. We could use three pairs, but two pairs is the minimum needed for similarity statements.

-----------

To figure out what goes in the third answer box, note how the order HGF is given to us. The order is important.

We have H first, G second, F third.

H being first, and it having a single arc, means that whatever has a single arc on the other triangle must be first. That would be H. Unfortunately they reuse angle H which makes things confusing a bit.

G is second in HGF, and G has the double arc marking. Note how M also has this double arc marking. Therefore we have M second in the answer. So far we have HM as part of the third answer.

The only thing left is N. Therefore, we have triangle HMN as the answer for the third box.

Put another way, we have these pairings:

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This is why the order is important. So we can see how the angles pair up in the order that they do.

This is why triangle HGF is similar to triangle HMN.

We can write that as triangle HGF ~ triangle HMN

The ~ mark means "similar"

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