question archive Kramer Company is authorized to issue 45,000 shares of its 7 percent, $100 par value preferred stock
Kramer Company is authorized to issue 45,000 shares of its 7 percent, $100 par value preferred stock
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Kramer Company is authorized to issue 45,000 shares of its 7 percent, $100 par value preferred stock. On March 15, Kramer issues 5,000 shares for $200 per share. On November 1, Kramer declares the dividend and pays it on December 1. What amount of cash was paid to the preferred shareholders?
- 70,000
- 315,000
- 630,000
- 35,000
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Shares = 5000
Preferred stock =100
Dividend rate payable = 7%
Cash paid to preferred shareholders = 5,000 * 7% * $100
Cash paid to preferred shareholders = 500000* 7%
Cash paid to preferred shareholders = 35000
