13. Halverstein Company's outstanding stock consists of 7,000 shares of cumulative 5% preferred stock with...
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Accounting
13. Halverstein Company's outstanding stock consists of 7,000 shares of cumulative 5% preferred stock with a $10 par value and 3,000 shares of common stock with a $1 par value. During the first three years of operation, the corporation declared and paid the following total cash dividends.
Dividend Declared
Year 1
$
0
Year 2
$
6,000
Year 3
$
32,000
The amount of dividends paid to preferred and common shareholders in Year 2 is:
A. $3,000 preferred; $3,000 common.
B. $0 preferred; $6,000 common.
C. $6,000 preferred; $0 common.
D. $4,200 preferred; $1,800 common.
E. $3,500 preferred; $2,500 common.
28. Amortizing a bond discount:
A. Decreases the Bonds Payable account.
B. Increases cash flows from the bond.
C. Allocates a portion of the total discount to interest expense each interest period.
D.Decreases interest expense each period.
E. Increases the market value of the Bonds Payable.
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