Exam 11: Corporations: Organization, Share Transactions, Dividends,and Retained Earnings

The concept of an "artificial being" refers to which form of business organization?

Ephram Company has 3,000 shares of 5%, $100 par non-cumulative preference shares outstanding at December 31, 2011.No dividends have been paid on these shares for 2010 or 2011.Dividends in arrears at December 31, 2011 total

Preference shareholders have the right to receive assets in the event of liquidation before the ordinary shareholders.

Unpaid dividends on non-cumulative preference shares are called dividends in arrears.

Lopez, Inc.has 2,000 shares of 4%, $50 par value, cumulative preference shares and 50,000 ordinary shares with a $1 par value outstanding at December 31, 2010, and December 31, 2011.The board of directors declared and paid a $3,000 dividend in 2010.In 2011, $15,000 of dividends are declared and paid.What are the dividends received by the preference and ordinary shareholders in 2011?