Answer:
Explanation:
Journal entries
Jan. 1, 2019
Dr Cash (750,000x$35) $26,250,000
Cr Common stock $26,250,000
Jan. 1, 2019
Dr Cash (540,000x$105) $56,700,000
Cr Preferred shares (540,000x$100) $54,000,000
Cr Paid in capital in excess of par-Preferred stock $2,700,000
Dec. 22, 2021
Dr Cash dividend $15,000,000
Cr Dividend payable-Preferred $12,150,000
Cr Dividend payable-Common $2,850,000
Feb. 12, 2022
Dr Dividend payable-Preferred $12,150,000
Dr Dividend payable-Common $2,850,000
Cr Cash $15,000,000
Dividend payable-Preferred = $54,000,000x7.5%x3 years =$12,150,000
Dividend payable-Common = $15,000,000-$12,150,000 =$2,850,000
