[jul1am]

If I'm given:

Preferred Stock: $50 par value, 8 percent cumulative, 10000 shares authorized, issued, and outstanding.

Common Stock: $5 par value, 200,000 shares authorized, issued, and outstanding.

THe company paid $30,000, $30,000, $94,000, and $130,000 in dividends during 2003, 2004, 2005, and 2006 respectively. The market price per common share was $7.25 and $8.00 per share at year end 2005 and 2006, respectively.

1. Determine the dividends per share and the total dividends paid to common stock-holders and preferred stockholders in 2003, 2004, 2005, and 2006.

2. Perform the same computations, with the assumption that the preferred stock was noncumulative.

3. Calculate the 2005 and 2006 dividends yield for common stock, using dividends per share computed in #2.

4. How are cumulative preferred stock and noncumulative preferred stock similar to long-term bonds? How do they differ?

Please help. I get so confused by this stuff.