Answer:
2,000 shares of 8% $100 par cumulative preferred stock = $16,000 (if preferred stock dividends are not paid one year, they accumulate until they are fully paid in the next years)
34,000 shares $10 par common stocks
Year Dividends Preferred Per Common Per
stocks p.s. stocks c.s.
1 $12,000 $12,000 $6 $0 $0
2 $16,000 $16,000 $8 $0 $0
3 $24,740 $20,000 $10 $4,740 $0.14
Preferred stock dividends are paid before common stock dividends.
