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gayaneshka [121]
3 years ago
8

Art, Inc., has 5,000 shares of 4%, $100 par value, cumulative preferred stock and 20,000 shares of $1 par value common stock out

standing at December 31, 2018. There were no dividends declared in 2016. The board of directors declares and pays a $45,000 dividend in 2017 and in 2018. What is the amount of dividends received by the common stockholders in 2018?
$25,000

$20,000

$45,000

$0
Business
1 answer:
son4ous [18]3 years ago
5 0

Answer:

Dividend paid to Common Stockholders  =  $25000

so correct option is a. $25,000

Explanation:

given data

shares outstanding = 5,000

Par value = $100

Dividend Rate = 4%

common stock outstanding = 20,000 shares

par value = $1

dividend = $45,000

to find out

What is the amount of dividends received by the common stockholders in 2018

solution

first we get here Value of Preferred Stock that is express as

Value of Preferred Stock = Number of shares outstanding  ×  Par value    ....................1

put here value we get

Value of Preferred Stock is = 5,000 × $100

Value of Preferred Stock is = $500,000

and

Annual Dividend will be here

Annual Dividend = Value of Preferred Stock × Dividend Rate      .........................2

put here value we get

Annual Dividend = $500,000 × 4%

Annual Dividend = $20,000

and

so as for 2017  Dividend paid is here as

Dividend paid to Preferred Stockholders = for 2016 + for 2017

Dividend paid to Preferred Stockholders = $20,000 + $20,000 = $40000

so Dividend paid to Common Stockholders = $45000- $40000 = $5000

and

for 2018 Dividend paid is here as

Dividend paid to Preferred Stockholders is  = $20,000 for the 2018

so

Dividend paid to Common Stockholders  will be = $45000 - $20000

Dividend paid to Common Stockholders  =  $25000

so correct option is a. $25,000

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Answer:

A. $30,000 decrease

Explanation:

Ortega Industries

Direct materials $ 150,000

Direct labor 240,000

Variable manufacturing overhead 90,000

Fixed manufacturing overhead 120,000

Total Manufacturing Costs for 15000 units is  $ 600,000

Total Manufacturing Costs per unit=  Total Costs/ Total units= $600,000 / 15000= $ 40

An outside supplier has offered to sell the component to Ortega for $34.

Profit per unit = $ 6

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The fixed manufacturing overhead reflects the cost of Ortega's manufacturing facility= $ 120,000 Which cannot be used for any other facility.

Unavoidable Fixed Costs= $ 120,000

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If Ortega Industries purchases the component from the outside supplier, the effect on operating profits would be a  $30,000 decrease because after the profit of $ 90,000 cancel the effect of fixed costs of $ 90,000  the fixed costs of $ 30,000 will still be unavoidable and cannot be used for any other facility.

4 0
3 years ago
The neoclassical view holds that long-term expansion of potential GDP due to _______________________ will determine ____________
boyakko [2]

Answer:

1.  economic growth;

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Therefore, the size of the economy is defined by potential GDP, and wages and prices will adjust in an intelligent manner so that the economy will move back to its potential GDP level of output.

Hence, The neoclassical view holds that long-term expansion of potential GDP due to ECONOMIC GROWTH will determine THE SIZE OF THE ECONOMY

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I hope my answer helps you

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In this case, we can state that in cases like the one shown in the question above, the short payback period is very beneficial and interesting to the consumer, as it can promote economic benefits.

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5 0
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