Prepare ais journal entry to record the issuance

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Corporation issued 100,000 shares of $20 par value, cumulative, 8% preferred stock on January 1, 2009, for $2,100,000. In December 2011, AI declared its first dividend of $500,000.

Instructions

(a) Prepare AI's 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? 

Reference no: EM131132392

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