At the end of its first year of operations,Alder Co.had 150,000 shares of preferred stock,5% cumulative,$100 par value.It also has 1,000,000 shares of common stock $0.01 par value.(The share information represents the numbers of shares issued and outstanding for both types of stock. )If sufficient dividends are declared,what is the per share dividend that will be paid on the preferred stock?
A)$0.01 per share.
B)$100.00 per share.
C)$5.00 per share.
D)$7.50 per share.

Question

Quizplus · Accepted Answer

Dividends per share on preferred stock = Par value × Annual dividend rate
= $100 × 0.05 = $5 per share (if declared)

At the End of Its First Year of Operations,Alder Co