The following elements of stockholders' equity are from the balance sheet of Smith Marketing Corp. at December 31, 2023: paid no preferred dividends in 2023. Data Table Stockholders' Equity Paid-In Capital: Preferred Stock—4%, $2 Par Value; 90,000 shares authorized, 85,000 shares issued and outstanding $170,000 Common Stock—$0.10 Par Value; 11,000,000 shares authorized, 10,250,000 shares issued and outstanding 1,025,000 Requirements 1. Compute the dividends to the preferred and common shareholders for 2024 if total dividends are $200,000 and assuming the preferred stock is noncumulative. Assume no changes in preferred and common stock in 2024. 2. Record the journal entries for 2024 assuming that Smith Marketing Corp. declared the dividends on July 1 for stockholders of record on July 15. Smith paid the dividends on July 31. Requirement 1. Compute the dividends to the preferred and common shareholders for 2024 if total dividends are $200,000 and assuming the preferred stock is noncumulative. Assume no changes in preferred and common stock in 2024. (Complete all input boxes. Enter "0" for any zero amounts.) Smith's 2024 dividend would be divided between preferred and common stockholders in this manner: Total Dividend—2024 Dividend to preferred stockholders: Dividend in arrears Current year dividend Total dividend to preferred stockholders Dividend to common stockholders

Cornerstones of Financial Accounting

4th Edition

ISBN:9781337690881

Author:Jay Rich, Jeff Jones

Publisher:Jay Rich, Jeff Jones

Chapter10: Stockholder's Equity

Section: Chapter Questions

Problem 67E: Cash Dividends on Common and Preferred Stock Lemon Inc. has the following information regarding its...

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Question

The following elements of stockholders' equity are from the balance sheet of Smith Marketing Corp. at December 31, 2023:

paid no preferred dividends in 2023.

Data Table

Stockholders' Equity
Paid-In Capital:
Preferred Stock—4%, $2 Par Value; 90,000 shares authorized, 85,000 shares issued and outstanding	$170,000
Common Stock—$0.10 Par Value; 11,000,000 shares authorized, 10,250,000 shares issued and outstanding	1,025,000

Requirements

1.	Compute the dividends to the preferred and common shareholders for 2024 if total dividends are $200,000 and assuming the preferred stock is noncumulative. Assume no changes in preferred and common stock in 2024.
2.	Record the journal entries for 2024 assuming that Smith Marketing Corp. declared the dividends on July 1 for stockholders of record on July 15. Smith paid the dividends on July 31.

Requirement 1. Compute the dividends to the preferred and common shareholders for

2024

if total dividends are

$200,000

and assuming the preferred stock is noncumulative. Assume no changes in preferred and common stock in

2024.

(Complete all input boxes. Enter "0" for any zero amounts.)

Smith's

2024

dividend would be divided between preferred and common stockholders in this manner:

Total Dividend—2024
Dividend to preferred stockholders:
Dividend in arrears
Current year dividend
Total dividend to preferred stockholders
Dividend to common stockholders

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