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    scada's Avatar
    scada Posts: 14, Reputation: 1
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    #1

    May 2, 2011, 09:51 AM
    Paying out shares
    When paying out shares do you take the total invested shares plus the retained earings to do the calculations.

    Common shares 100,000 1,500,000
    Retained earings 1,800,000
    Preferred shares 100,000 at 50 per share 5,000,000
    Total 8,300,000

    Do I pay out the preferred shares from the 8,300,000
    AK lawyer's Avatar
    AK lawyer Posts: 12,592, Reputation: 977
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    #2

    May 2, 2011, 10:41 AM
    Quote Originally Posted by scada View Post
    when paying out shares do you take the total invested shares plus the retained earings to do the calculations.

    common shares 100,000 1,500,000
    retained earings 1,800,000
    preferred shares 100,000 at 50 per share 5,000,000
    total 8,300,000

    Do i pay out the preferred shares from the 8,300,000
    You have evidently pasted this from an Excel document, but unfortunately the colums don't copy. But I can see that the 8,300,000 is the total of the three figures at the end of each row.

    I don't know why you are including retained earnings in your calculation.

    Are the preferred shareholders entitled to $50 per share whenever a dividend is declared?
    scada's Avatar
    scada Posts: 14, Reputation: 1
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    #3

    May 2, 2011, 10:54 AM
    Comment on AK lawyer's post
    The prefffered shares were purchased at $50 per share. I have to pay out quarterly to preferred shareholders. I'm not sure the amout I have to pay. The above is what I have including the sale of the $50.per share to 100,000 shareholders. I'm very confused on what to do.
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    scada Posts: 14, Reputation: 1
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    #4

    May 2, 2011, 11:22 AM
    I hope you receive this the proper way. I have unlimited common shares. I have issues 1,000,000 total of 1,500,000. I have 1,800,000 reatined earings. I have issues 100,000 preferred shared earings at $50 perferred shares.=5,000,000. I was also authorized unlimited no par value of $4 noncumulative prefeered shares.now I have to pay out quaterly shares to the preferred shares. Do I total the three preferred shares 5,000,000
    common shares 1,500,000
    retained earings 1,800,000
    I don't know the amount of what to pay out to the preferred shares
    AK lawyer's Avatar
    AK lawyer Posts: 12,592, Reputation: 977
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    #5

    May 2, 2011, 12:04 PM
    Quote Originally Posted by scada View Post
    ...I'm very confused on what to do. ...
    I don't know the amount of what to pay out to the preferred shares ...
    I'm very confused too:

    You are looking at paying dividends amounting to hundreds of thousands, or perhaps millions, of dollars, and you haven't thought to consult an attorney?

    Huh?
    _____

    Ah. Homework.
    Quote Originally Posted by Scada
    I am taking an accounting course and sometimes i get stuck. i really appreciate the help i receive from all you guys. (from Scada's profile)
    Now it's making sense. :)

    As I say, I don't think retained earnings has anything to do with calculating the payable dividend. You would look to the amount the board of directors decided to pay as a dividend and to the amount required to be paid to owners of the preferred stock. Retained earnings is simply the amount left over.

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