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netineya [11]
2 years ago
9

Brown Corporation has 500,000 shares of 9%, $40 par value cumulative preferred stock authorized, 100,000 shares issued, and 80,0

00 shares outstanding. In addition, Brown Corporation has 1,300,000 shares of $10 par value common stock issued and outstanding. Dividends relative to the preferred stock are two years in arrears. If Brown declares a $2,000,000 dividend during the current period, the amount of the dividend applicable to the preferred and common stockholders is:a. $576,000 and $1,424,000, respectivelyb. $720,000 and $1,280,000, respectivelyc. $1,080,000 and $920,000, respectivelyd. $864,000 and $1,136,000, respectively
Business
1 answer:
olganol [36]2 years ago
7 0

Answer:

D. $864,000 and $1,136,000, respectively

Explanation:

As the preferred stock dividend is cumulative, the company has to pay any outstanding dividend to preferred stockholders'.

Given,

Dividends relative to the preferred stock are two years in arrears.

Number of preferred shares outstanding = 80,000 shares

Par value = $40

Dividend rate = 9%

Annual dividend = 80,000 shares × $40 × 9% = $288,000

Therefore, current year preferred dividend = $288,000

As dividends were outstanding for the previous 2 years, last 2 years dividends = $288,000 + $288,000 = $576,000

Total dividends to be payable to preferred stockholders = $576,000 + $288,000 = $864,000

Therefore, common stockholders will receive = $2,000,000 - $864,000 = $1,136,000.

Therefore, <em>option </em><em>D</em><em> is the answer.</em>

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The Dlabay Company had a quick ratio of 1.4, a current ratio of 2.75, an inventory turnover of 6 times, total current assets of
Gnesinka [82]

Answer:

Annual sale is $2,282,728.80 and ACP is 44.87 days

Explanation:

Since the annual sales are not given, so first we have to compute the current liabilities amount, then inventory amount, after that, only the sales amount could be found

So, the current liabilities = Current assets ÷ current ratio

                                         =  $775,000 ÷ 2.75

                                         = $281,818  

Now the quick ratio = (Current assets - inventory) ÷ current liabilities

        1.4 times          = ($775,000 - inventory) ÷ $281,818  

$394545.20 = $775,000 - inventory

So, inventory = $380,454.80

Now, the inventory turnover equals to

Inventory turnover ratio = (Turnover ÷ average inventory)

6 times = Annual sales ÷ 380454.80

So, annual sales = $2,282,728.80

The computation of the ACP is shown below:

= (Account receivable ÷ credit sales) × 360 days

Since account receivables is not given so first, we have to calculate it which equals to

= Current assets - cash - inventory  

=  $775000 - $110,000 - $380,454.80

= $284545.20

Now put these values to the above formula  

So, the value would equal to

= ( $284545.20 ÷ $2,282,728.80) × 360 days

= 44.87 days

5 0
3 years ago
“You’ve been specially selected to win our grand prize. Contact us to collect it!” This is probably a(n) _____.
vazorg [7]

You’ve been specially selected to win our grand prize. Contact us to collect it!” This is probably a scam.

5 0
3 years ago
Read 2 more answers
Diane Corporation is preparing its year-end balance sheet. The company records show the following selected amounts at the end of
Ghella [55]

Answer:

Diane Corporation

The amount of current liabilities is:

=  $106,600.

Explanation:

a) Data and Calculations:

Total assets $ 550,000

Total noncurrent assets 352,000

Liabilities: Notes payable (8%, due in 5 years) 21,000

Accounts payable 51,000

Income taxes payable 14,000

Liability for withholding taxes 4,000

Rent revenue collected in advance 9,000

Bonds payable (due in 15 years) 100,000

Wages payable 9,000

Property taxes payable 5,000

Note payable (10%, due in 6 months) 14,000

Interest payable 600

Common stock 250,000

Current liabilities:

Accounts payable                                $51,000

Income taxes payable                           14,000

Liability for withholding taxes                4,000

Rent revenue collected in advance      9,000

Wages payable                                      9,000

Property taxes payable                         5,000

Note payable (10%, due in 6 months) 14,000

Interest payable                                       600

Total current liabilities =                 $106,600

b) Current liabilities represent the debts that Diane owes creditors within the current accounting period.  They have short-term duration or are due to be repaid within the next 12 months.

3 0
3 years ago
What message is this price tag telling shoppers? (other than it is on sale)
KatRina [158]
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2 years ago
3. Suppose you are thinking of purchasing the Moore Co.’s common stock today. If you expect Moore to pay $3.1, $3.38, $3.70, $4.
BlackZzzverrR [31]

Answer:

$69.87

Explanation:

The price i would be willing to pay for the stock can be determined by finding the present value of the dividend payments

Present value is the sum of discounted cash flows

Present value can be calculated using a financial calculator

Cash flow in year 1 = 3.1

Cash flow in year 2 = 3.38

Cash flow in year 3 = 3.70

Cash flow in year 4 = 4.02

Cash flow in year 5 = 4.38 + 95 = 99.38

I = 11%

Present value = $69.87

To find the PV using a financial calculator:

1. Input the cash flow values by pressing the CF button. After inputting the value, press enter and the arrow facing a downward direction.

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