Rye Co. issued 50,000 shares of $20 par value, cumulative, 10% preferred stock on January...
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Accounting
Rye Co. issued 50,000 shares of $20 par value, cumulative, 10% preferred stock on January 1, 2018, for $1,200,000. In December 2020, Rye declared its first dividend of $300,000.
Instructions:
a. Prepare Ryes journal entry to record the issuance of the preferred stock.
b. If the preferred stock is not cumulative, how much of the $500,000 would be paid to common stockholders?
c. If the preferred stock is cumulative, how much of the $500,000 would be paid to common stockholders?
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