Answer:
(a)
Dr. Cash $2,630,000
Cr. Preferred Stock $2,147,000
Cr. Add-in-Capital excess of par preferred stock $483,000
Explanation:
Preferred stockholders has an advantage that they are paid first when there is any dividend is announced. The residual dividend will be divided into the common stockholders. Any prior years due dividend and current years dividend associated with preferred share will be paid first.
Par value = 113,000 x 19 = $2,147,000
Excess of par value = $2,630,000 - $2,147,000 = $483,000
