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How to calculate prefrred dividend before devidend declared?

Updated: 9/24/2023
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Nigussiedagnewfb7515

Lvl 1
9y ago

Best Answer

Calculation of preferred dividend does not depend upon the dividend declared at the end of the year. Preferred dividend is fixed and is calculated using the fixed percentage of preferred dividend. For example a company has 1000 shares of 6 preferred stock outstanding, each with par value of $100. 6 mentioned before preferred stock is the dividend rate(6%) to be received by preferred shares. Preferred Dividend = No. of preffered shares outstanding x Par value of each share x Dividend rate. = 1000 x 100 x 6%. = $ 6000. Dividend per share = 6000/1000 = $6

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Q: How to calculate prefrred dividend before devidend declared?
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