Answer:
2018
Preferred Dividend = $54,000
Common Stockholders = $9,000
2019
Preferred Dividend arrears =$54,000
Common Stockholders = $0
2020
Preferred Dividend = $54,000
Common Stockholders = $270,000
Explanation:
Preferred stockholders has an advantage that they are paid first when there is any dividend is announced. The residual dividend will be divided into the common stockholders. Any prior years due dividend and current years dividend associated with preferred share will be paid first.
As per given data
Preferred shares = 18,000 x $50 = $900,000
Preferred Dividend = $900,000 x 6% = $54,000
2018
Dividend Declared = $63,000
Dividend Allocated to Common Stockholders = Dividend Declared - Preferred Dividend = $63,000 - $54,000 = $9,000
2019
Dividend Declared = $0
Preferred Dividend Arrears = $54,000
2020
Dividend Declared = $378,000
Preferred Dividend Arrears = $54,000
Dividend Allocated to Common Stockholders = Dividend Declared - Preferred Dividend - Preferred Dividend Arrears = $378,000 - $54,000 - $54,000 = $270,000
