# Best answer: Where do you find preferred dividends on financial statements?

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## How do you find preferred dividends on a balance sheet?

Multiply the amount stated by the number of shares issued and outstanding to calculate preferred stock dividends due. For example, if the amount is \$4, which means the amount the company pays per share, and there are 50,000 preferred shares issued and outstanding, multiply \$4 times 50,000 shares.

## What are preferred dividends?

Preferred dividends are paid to holders of a company’s preferred stock. If a company’s profits aren’t enough to pay all shareholders a dividend, the company will pay its preferred shareholders their preferred dividends and the shareholders of the company’s common stock will miss out on that round of dividends.

## How do you calculate preferred dividends in arrears?

Multiply the number years of missed dividend payments by the annual dividend per share to calculate the dividends in arrears per share. In the example, multiply \$5 by two years to get \$10 per share of dividends in arrears.

## How do you account for preferred stock?

To comply with state regulations, the par value of preferred stock is recorded in its own paid-in capital account Preferred Stock. If the corporation receives more than the par amount, the amount greater than par will be recorded in another account such as Paid-in Capital in Excess of Par – Preferred Stock.

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## How do you calculate annual preferred dividends?

Preferred Share Annual Dividend Formula

To find the annual dividend, multiply the par value by the dividend rate. For example, if the preferred shares have a par value of \$50 and a dividend rate of 6 percent, multiply \$50 by 0.06 to find that the preferred share pays a \$3 annual dividend.

## How do you calculate preferred pay?

Multiply the preferred dividends per share by the number of shares the company issued to find the total annual dividends paid to preferred shares. In this example, if the company issued 65,000 preferred shares, multiply 65,000 by \$1.89 to find the company pays \$122,850 in preferred dividends each year.