When Crossett Corporation was organized in January, Year it immediately issued shares of $ par, percent, cumulative
preferred stock and shares of $ par common stock. Its earnings history is as follows: Year net loss of $; Year net
income of $; Year net income of $ The corporation did not pay a dividend in Year
Required
a How much is the dividend arrearage as of January Year
Dividend arrearage
b Assume that the board of directors declares a $ cash dividend at the end of Year remember that the Year and Year
preferred dividends are due How will the dividend be divided between the preferred and common stockholders?
Total amount distributed to preferred shares
Total amount distributed to common shares
