Chapter 6
Corporations: Contributed Capital and Dividends
272
AP-10A (
5
)
Martin Inc. was formed on January 1, 2014. Its shares were all issued during the first year of
operations and were comprised as follows: 80,000 common shares and 10,000, $2 cumulative
preferred shares. Over the past four years, Martin Inc. has declared and paid the following
cash dividends.
Year
Total
2014
$30,000
2015
$35,000
2016
$0
2017
$45,000
Calculate the amount of dividends paid to each class of shareholders for each year.
Class of Shares
# of shares
2014
2015
2016
2017
Preferred Shares—cumulative
10,000
Common Shares
80,000
Total dividends paid
$30,000
$35,000
$0
$45,000
AP-11A (
3
5
)
Given below is the equity section of Lizzy Dizzy Corporation at December 31, 2016. Preferred
shares were sold at $100 each.
Lizzy Dizzy Corporation
Shareholders’ Equity
As at December 31, 2016
Share Capital
Preferred Shares, $7, cumulative, 200,000 authorized
$20,000,000
Common Shares, unlimited authorized, 4,000,000 issued
and outstanding
59,000,000
Total Share Capital
79,000,000
Retained Earnings
64,450,000
Total Shareholders’ Equity
$143,450,000
Required
From the information provided above, calculate the following.
a) Calculate the number of preferred shares issued.
