Burnell Inc. has 5000 shares of 4% $50 par value cumulative preferred stock and 100000 shares of $1 par value common stock outstanding at December 31 2016 and December 31 2015. The board of directors declared and paid a $8000 dividend in 2016. In 2017 $30000 of dividends are declared and paid. What are the dividends received by the preferred and common shareholders in 2017? $Common\begin{array} { l l l } & \text { Preferred } & \text { Common} \\\end{array}$
A) $$18,000$12,000\begin{array} { l l l } & \$ 18,000 && \$ 12,000 \\\end{array}$
B) $$15,000$15,000\begin{array} { l l l } & \$ 15,000 && \$ 15,000 \\\end{array}$
C) $$12,000$18,000\begin{array} { l l l } & \$ 12,000 && \$ 18,000 \\\end{array}$
D) $$10,000$20,000\begin{array} { l l l } & \$ 10,000 && \$ 20,000\end{array}$

Question

Burnell Inc. has 5000 shares of 4% $50 par value cumulative preferred stock and 100000 shares of $1 par value common stock outstanding at December 31 2016 and December 31 2015. The board of directors declared and paid a $8000 dividend in 2016. In 2017 $30000 of dividends are declared and paid. What are the dividends received by the preferred and common shareholders in 2017?

Common\begin{array} { l l l } & \text { Preferred } & \text { Common} \\\end{array}

A)

$18,000$12,000\begin{array} { l l l } & \$ 18,000 && \$ 12,000 \\\end{array}

B)

$15,000$15,000\begin{array} { l l l } & \$ 15,000 && \$ 15,000 \\\end{array}

C)

$12,000$18,000\begin{array} { l l l } & \$ 12,000 && \$ 18,000 \\\end{array}

D)

$10,000$20,000\begin{array} { l l l } & \$ 10,000 && \$ 20,000\end{array}

Katrina Anthony · Accepted Answer

Final Answer : C

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