The
Definition Of

Dividends in arrears

When preferred stock, is cumulative, preferred dividends not declared in a given period are called dividend in arrears.

To illustrate, assume that scientific leasing has 5000 shares of 7% is $35,000 (5,000 but dividends are two years in arrears. In this case, preferred stockholders are entitled to receive the following dividends in the current year.

 

                                     Dividends in areas (35,000              $70,000

                                  Current-year dividends                               35,000                        

                                       Total preferred dividends                            $105,000

Share it:

More from this Section

  • Treasury stock
    Treasury stock is a corporation’s own stock that has been issued and subsequently reacquired from shareholders by the corporation but not retired.
  • Days in inventory
    A variant of the inventory turnover ratio is days in inventory that measures the average number of days inventory is held; calculated as 365 divided by the inventory turnover ratio.
  • Receivables turnover
    Receivables turnover is a measure of the liquidity of receivables during the period; computed by dividing net credit sales (net sales less credit sales) by average net receivables.
  • Times interest earned
    Times interest earned provides an indication of the company’s ability to meet interest payments as they come due; computed by dividing income before interest...
  • Transactions
    Transactions (business transactions) are a business’s economic events recorded by accountants. Transactions may be external or internal.
  • Straight-line method of amortization
    Straight-line method of amortization is a method of amortizing bond discount or bond premium that results in allocating the same amount to interest expense in each interest period.
  • Budgeted Balance Sheet
    The budgeted balance sheet is a projection of financial position at the end of the budget period. This budget is developed from the budgeted balance sheet...