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zysi [14]
3 years ago
11

When Crossett Corporation was organized in January, Year 1, it immediately issued 4,000 shares of $50 par, 6 percent, cumulative

preferred stock and 50,000 shares of $20 par common stock. Its earnings history is as follows: Year 1, net loss of $35,000; Year 2, net income of $125,000; Year 3, net income of $215,000. The corporation did not pay a dividend in Year 1.
Required:
a. How much is the dividend arrearage as of January 1, Year 1?
b. Assume that the board of directors declares a $25,000 cash dividend at the end of year 1 (remember that the year 1 and year 2 preferred dividends are due). How will the dividend be divided between the preferred and common stockholders?
Business
1 answer:
astraxan [27]3 years ago
8 0

Answer:

a. $0

The company was organized in January, Year 1. They do not have to pay dividends because the company just started operations. The cumulative dividends are only to be paid at the end of the period so there is no dividend arrear here.

b. Preferred shareholders are meant to get:

= 4,000 shares * 50 * 6%

= $12,000 per year

As they are owed $12,000 from the first year and are now owed for the second, the dividends they will get is:

= 12,000 + 12,000

Preferred Dividends = $24,000

Ordinary shareholders get what is left:

= 25,000 - 24,000

= $1,000

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sales of $1.67 million, cost of goods sold of $810,800, depreciation expenses of $175,000, and interest expenses of $89,575. Ass
Hunter-Best [27]

Answer:

Net income= 561,506.25

Explanation:

Giving the following information:

sales of $1.67 million, cost of goods sold of $810,800, depreciation expenses of $175,000, and interest expenses of $89,575.

Tax= 35 percent

We need to determine the net income.

Sales= 1,670,000

COGS= (810,800)

Gross profit= 859,200

Depresiation= (175,000)

Interest= (89,575)

EBT= 594,625

Tax= (594,625*0.35)= (208,118.75)

Depreciation= 175,000

Net income= 561,506.25

5 0
3 years ago
A card which requires the cardholder to pay a sum of money equal to the credit limit is called a
Brrunno [24]
The answer is Credit card.

Credit card is a small plastic card issued by a bank, business, etc., allowing the holder to purchase goods or services on credit.
5 0
3 years ago
Billy is interested in lowering the speed limit on a major road near his house. A citizens’ group has formed to lobby the city c
Nezavi [6.7K]

Answer:

The correct answer is a. behaving like a free rider

Explanation:

The free-rider problem is an economic problem that arises when an individual (stowaway) tries to receive a benefit from using a good or service but avoids paying for it. It is also known by its name in English, problem of the free rider.

The government tries to address the problems of stowaways through fiscal rules and regulations, especially to prevent the impact on the environment and excessive use of resources. Therefore, stowaways are also known as parasitic consumers, because on many occasions they consume goods and services financed by others, of which they paid nothing.

Examples of the free-rider problem

When there are public goods, such as parks, armed forces, public lighting or police, stowaways take advantage of the fact that it is not possible to exclude them from consumption and refuse to pay for them. This creates a problem of provision since although many consumers value the services they provide, there will be those who use them but do not contribute to their financing.

7 0
3 years ago
If the price of a good increases by 5% and the quantity demanded decreases by 5%, then at that price, the good is _____.
anastassius [24]

Answer: unitary price elastic

Explanation:

A good is unitary price elastic if a change in price leads to the same proportional change in quantity demanded.

The coefficient of a good with unitary elasticity is 1 .

Coefficient of elasticity = percentage change in quantity demanded / percentage change in price

= 5% / 5% = 1

I hope my answer helps you

7 0
3 years ago
Your boss gave you a project to complete in 1 week. How would you go about
Paladinen [302]

Answer:

Communicate the task. Describe to your employees exactly what you want done, when you want it done, and the end results you expect. Be clear and unambiguous and encourage your employees to ask questions. ... Empower your employees with the level of authority required to complete the task.

4 0
3 years ago
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