A corporation has 35,000 shares of 1% preferred stock outstanding. Also, there are 35,000 shares of common stock outstanding. Par value for each is $100. If a $900,000 dividend is paid, how much goes to the preferred stockholders?

Since preference stockholders have an edge over equity stockholders regarding dividend. They are paid in fill and remaining amount is distributed among common stockholders.

Dividend paid to preferred stockholders = 0.01 × 3,500,000

= $35,000

Preferred stockholders receive $35,000. Remaining amount of $865,000 goes to common stockholders.

A corporation has 35,000 shares of 1​% preferred stock outstanding.​ Also, there are 35,000 shares of common stock outstanding. Par value for each is​ $100. If a $900,000 dividend is​ paid, how much goes to the preferred​ stockholders?

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A corporation has 35,000 shares of 1% preferred stock outstanding. Also, there are 35,000 shares of common stock outstanding. Par value for each is $100. If a $900,000 dividend is paid, how much goes to the preferred stockholders?