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General Accounting Discussions: Bit stuck with Preference Shares and Ordinary Shares

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    • CommentAuthorMandyofOz
    • CommentTimeOct 15th 2009
     
    I was just hoping someone could explain how to do the following, my study material doesn't go into too much detail at all.

    Company has 10,000 preference shares issued at $50.00 (10% dividend, noncumulative) and 20,000 ordinary shares. At the end of the current year, they declare a dividend of $120,000.

    I dont know how to work out the following;

    1. How is the dividend allocated between preference and ordinary?
    2. What is the dividend per share to preference and ordinary?

    If anyone is able to help work through this, or now the equations to use, i would really appreciate your help.

    Thanks..

    Mandy

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