Question

2. Derek Corporation was organized on January 1, 2017. During its first year, the corporation issued 40,000 shares of $5 par value preferred stock and 400,000 shares of $1 par value common stock. At December 31, the company declared the following cash dividends:
2017 $15,000
2018 $32,000
2019 $80,000
Instructions
(a) Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 6% and not cumulative.
(b) Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 8% and cumulative.
(c) Journalize the declaration of the cash dividend at December 31, 2019 using the assumption of part (b).​

Answer 1

Answer:

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