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KATRIN_1 [288]
3 years ago
5

The stage of a product's life cycle when the sales curve peaks and starts to decline, and profits continue to fall

Business
1 answer:
ZanzabumX [31]3 years ago
8 0
<span>Intense competition!!!I hope this helped!!</span>
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On January 1, 2019, the board of directors was considering the distribution of a $63,500 cash dividend. No dividends were paid d
Eduardwww [97]

Answer:

1-a. We have:

Total amount to be paid as dividend to preferred stockholders = $9,312.40

Amount to be paid as dividend per share to preferred stockholders = $1.24 per share

Total amount to be paid as dividend to common stockholders = $54,287.60

Amount to be paid as dividend per share to common stockholders = $1.13 per share

1-b. We have:

Total amount to be paid as dividend to preferred stockholders = $27,937.20

Amount to be paid as dividend per share to preferred stockholders = $3.72 per share

Total amount to be paid as dividend to common stockholders = $35,662.80

Amount to be paid as dividend per share to common stockholders = $0.74 per share

2. The reason is that the unpaid dividends in 2017 and 2018 were carried forward and paid together with 2019 dividend to cumulative preferred stockholders, but this cannot be done when the preferred stock is noncumulative.

3. Some the factors include making preferred stock noncumulative, declaration of a higher cash dividend, redemption of redeemable preference shares so that only common stockholders receive dividends, and among others.

Explanation:

Note: This question is not complete and there is an error in the amount of the dividend being considered. The complete question is therefore presented with the correct dividend amount before answering the question as follows:

The records of Hoffman Company reflected the following balances in the stockholders' equity accounts at December 31, 2018:

Common stock, par $12 per share, 48,000 shares outstanding.

Preferred stock, 8 percent, par $15.5 per share, 7,510 shares outstanding.

Retained earnings, $236,000.

On January 1, 2019, the board of directors was considering the distribution of a $63,600 cash dividend. No dividends were paid during 2017 and 2018.

Required:

1. Determine the total and per-share amounts that would be paid to the common stockholders and to the preferred stockholders under two independent assumptions:

a. The preferred stock is noncumulative.

b. The preferred stock is cumulative.

2. Why were the dividends per share of common stock less for the cumulative preferred stock than the noncumulative preferred stock?

3. What factors would cause a more favorable dividend for the common stockholders?

The explanation of the answrs is now given as follows:

1-a. Determine the total and per-share amounts that would be paid to the common stockholders and to the preferred stockholders under the assumption that the preferred stock is noncumulative.

Total amount to be paid as dividend to preferred stockholders = Annual preferred stock dividend = 8% * $15.5 * 7,510 = $9,312.40

Amount to be paid as dividend per share to preferred stockholders = Total amount to be paid as dividend to preferred stockholders / Number of Preferred shares outstanding = $9,312.40 / 7,510 = $1.24 per share

Total amount to be paid as dividend to common stockholders = Amount of cash dividend being considered - Total amount to be paid as dividend to preferred stockholders = $63,600 - $9,312.40 = $54,287.60

Amount to be paid as dividend per share to common stockholders = Total amount to be paid as dividend to common stockholders / Number of common shares outstanding = $54,287.60 / 48,000 = $1.13 per share

1-b. Determine the total and per-share amounts that would be paid to the common stockholders and to the preferred stockholders under the assumption that the preferred stock is cumulative.

Annual preferred stock dividend = 8% * $15.5 * 7,510 = $9,312.40

Total amount to be paid as dividend to preferred stockholders = Annual preferred stock dividend for 3 years for 2017, 2018 and 2019 = $9,312.40 * 3 = $27,937.20

Amount to be paid as dividend per share to preferred stockholders = Total amount to be paid as dividend to preferred stockholders / Number of Preferred shares outstanding = $27,937.20 / 7,510 = $3.72 per share

Total amount to be paid as dividend to common stockholders = Amount of cash dividend being considered - Total amount to be paid as dividend to preferred stockholders = $63,600 - $27,937.20 = $35,662.80

Amount to be paid as dividend per share to common stockholders = Total amount to be paid as dividend to common stockholders / Number of common shares outstanding = $35,662.80 / 48,000 = $0.74 per share

2. Why were the dividends per share of common stock less for the cumulative preferred stock than the noncumulative preferred stock?

The reason is that the unpaid dividends in 2017 and 2018 were carried forward and paid together with 2019 dividend to cumulative preferred stockholders, but this cannot be done when the preferred stock is noncumulative.

3. What factors would cause a more favorable dividend for the common stockholders?

Some the factors include making preferred stock noncumulative, declaration of a higher cash dividend, redemption of redeemable preference shares so that only common stockholders receive dividends, and among others

5 0
2 years ago
Bill Bonecrusher graduates from college w/ choice of playing professional football at $2 mil. a year/coaching for $50,000 a year
tangare [24]

Answer:

His opportunity cost a graduation was$50,000  and eight years later is  $2 million

Explanation:

His opportunity cost at the time of graduation is $50,000 as he has 2 choices at that time, either playing soccer or coaching. And as he has been playing football for eight years which implying that he gave up the coaching option. The opportunity cost was therefore $50,000, which is a yearly amount of coaching.

in the same way his opportunity cost is $2 million  after 8 years because he has two alternatives to play soccer and create films. And as  he gave up the possibility to play football. Therefore, the opportunity cost for playing soccer was $2 million, which is the sum he gets.

8 0
3 years ago
White Company manufactures furniture. Assume the following information: Manufacturing overhead is allocated based on machine hou
Lorico [155]

Answer:

overhead rate: 15

applied overhead 30,000

underapplicatio for 1,000

Explanation:

\frac{Cost\: Of \:Manufacturing \:Overhead}{Cost \:Driver}= Overhead \:Rate

The manufacturing overhead rate is determinate by dividingthe total expected cost  by a cost driver. In this case, the machine hours.

estimated cost 150,000

expected machine hours 10,000

predeterminate overhead rate = 150,000/10,000 = 15

Next, to allocate cost, we multiply the actual value fo the cost driver by the rate

actual machine hours x MO rate

2,000 x 15 = 30,000 applied overhead.

Last, we compare with the actual overhead to determinate over or underapplied overhead:

applied - actual

30,000  -  31,000  = -1,000

Thew overhead was underapplied, as the cost were for 31,000 but we only recognize 30,000

3 0
3 years ago
Organizational and managerial skills that find their expression in a company's structure, routines, and culture are referred to
Aliun [14]
It is referred to as Capabilities. It is essential to accomplish its business model or bring about its mission. In addition, an easy way to comprehend the thought is to think about capabilities as organizational level expertise is set in people, method, and technology.  
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3 years ago
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What is home equity?
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Difference between the purchase price of the home and its current market price
3 0
3 years ago
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