Fritz Corporation Has 800,000 Shares of Preferred Stock and 1,800,000

Essay

Fritz Corporation has 800,000 shares of preferred stock and 1,800,000 shares of common stock.The cumulative preferred stock has a stated dividend of $2.50 per share.Under normal conditions,Kreisler pays out 30% of earnings available to common shareholders,however,because of a severe recession,Fritz retained all earnings last year.This year,Fritz earned net income of $6.4 million.