The shareholders’ equity of Kramer Industries includes the data shown below. During 2017, cash dividends of $150 million were declared. Dividends were not declared in 2015 or 2016.

($ in millions)

  Common stock $ 320

  Paid-in capital—excess of par, common 1,280

  Preferred stock, 10%, nonparticipating 160

  Paid-in capital—excess of par, preferred 320

Required:

Determine the amount of dividends payable to preferred shareholders and to common shareholders under each of the following two assumptions regarding the characteristics of the preferred stock. (Enter your answers in millions (i.e., 10,000,000 should be entered as 10).)

Assumption A — The preferred stock is noncumulative.

Assumption B — The preferred stock is cumulative.

pur-new-sol

Related Questions

	($ in millions)
Common stock	$	320
Paid-in capital—excess of par, common		1,280
Preferred stock, 10%, nonparticipating		160
Paid-in capital—excess of par, preferred		320