Answer:
Year 1
$ 32,000 Total Dividends
$ 32,000 Preferred Stockholers
Common Stockholers
$ 0,40 Dividends / Preferred Stock
0 Dividends / Common Stock
Year 2
$ 75,000 Total Dividends
$ 64,000 Preferred Stockholers
$ 11,000 Common Stockholers
$ 0,80 Dividends / Preferred Stock
$ 0,03 Dividends / Common Stock
Year 3
$ 80,000
$ 48,000 Preferred Stockholers
$ 32,000 Common Stockholers
$ 0,60 Dividends / Preferred Stock
$ 0,08 Dividends / Common Stock
Year 4
$ 110,000
$ 48,000 Preferred Stockholers
$ 62,000 Common Stockholers
$ 0,60 Dividends / Preferred Stock
$ 0,15 Dividends / Common Stock
Explanation:
Cash Dividends: The amount of cash that the company paid to its shareholders as a return of the investing made by the investors.
Common Stock: Ordinary shares that a company issued to the investors hoping to raise funds to the operation of the company.
As return, the investors receive a share of profit that are paid as dividends to each of them, if the company issued preferred share, then the shareholders of common stocks are not guaranteed and are paid after the
payment made to the preferred stock.
Preferred Stock: The stock gives to the investors a fixed amount of return, which is called, dividend, to its stockholder before paying dividends to common sotckholders.
