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Organic​ Produce, Inc. has​ 49,000 shares of common stock outstanding and​ 6,000 shares of preferred stock outstanding. The common stock is​ $0.08 par​ value; the preferred stock is​ 4% noncumulative with a​ $100.00 par value. On October​ 15, 2019, the company declares a total dividend payment of​ $56,000. How much dividend will be paid to the preferred​ stockholders?

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hamzatauseef

Answer:

$24,000

Explanation:

Preferred stock holders get priority when dividend is issued. The dividend is fixed on these by the rate given so lets calculate how much is payable first,

6000 shares * $100 per share = $600,000 total share value

Dividend payable = 600,000 * 0.04 = $24,000

So out of the total dividend of $56,000, a total of $24,000 is payable to preferred stock holders.

Hope that helps.