Answer:
See the explanation below.
Explanation:
Note: Find attached the summary table.
Total annual dividend payable to cumulative preferred 2% stock = 25,000 * $80 * 2% = $40,000
For 20Y1
Dividend declared = $24,250
Total payable to cumulative preferred 2% stock = $24,250
Cumulative preferred stock per share = $24,250 / 25,000 = $0.97 per share
Total cumulative preferred carried forward = $40,000 - $24,250 = $15,750
Total dividend payable to common stock = $0
Common stock dividend per share = $0
For 20Y2
Dividend declared = $9,000
Total payable to cumulative preferred 2% stock = $9,000
Cumulative preferred stock per share = $9,000 / 25,000 = $0.36 per share
Total cumulative preferred carried forward = $40,000 - $9,000 + $15,750 = $46,750
Total dividend payable to common stock = $0
Common stock dividend per share = $0
For 20Y3
Dividend declared = $106,750
Total payable to cumulative preferred 2% stock = $40,000 + $46,750 = $86,750
Cumulative preferred stock per share = $86,750 / 25,000 = $3.47 per share
Total dividend payable to common stock = $106,750 - $86,750 = $20,000
Common stock dividend per share = $20,000 / 100,000 = $0.20 per share
For 20Y4
Dividend declared = $95,000
Total payable to cumulative preferred 2% stock = $40,000
Cumulative preferred stock per share = $40,000 / 25,000 = $1.60 per share
Total dividend payable to common stock = $95,000 - $40,000 = $55,000
Common stock dividend per share = $55,000 / 100,000 = $0.55 per share
For 20Y5
Dividend declared = $110,000
Total payable to cumulative preferred 2% stock = $40,000
Cumulative preferred stock per share = $40,000 / 25,000 = $1.60 per share
Total dividend payable to common stock = $110,000 - $40,000 = $70,000
Common stock dividend per share = $70,000 / 100,000 = $0.70 per share
For 20Y6
Dividend declared = $165,000
Total payable to cumulative preferred 2% stock = $40,000
Cumulative preferred stock per share = $40,000 / 25,000 = $1.60 per share
Total dividend payable to common stock = $165,000 - $40,000 = $125,000
Common stock dividend per share = $125,000 / 100,000 = $1.25 per share
