# How do you calculate preferred dividends on financial statements?

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## Where do you find preferred dividends on financial statements?

The amount received from issuing preferred stock is reported on the balance sheet within the stockholders’ equity section. Only the annual preferred dividend is reported on the income statement.

## How do you calculate preference 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.

## Do preferred dividends go on balance sheet?

Companies must pay unpaid cumulative preferred dividends before paying any dividends on the common stock. All preferred stock is reported on the balance sheet in the stockholders’ equity section and it appears first before any other stock.

## What is preference dividend on an income statement?

Preferred dividends refer to the cash dividends that a company pays out to its preferred shareholders.

## How do you calculate dividends paid to preferred stockholders?

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.

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