The liberty of man in society is to be under no other legislative power but that established by consent in the commonwealth.
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Answer:
Therefore out of $145,000, dividend to preference share holders = $145,000
Explanation:
Whenever there is issue of preference shares, cumulative in nature then the dividend has to be paid every year, in case the dividend is not paid for any year, then that amount accumulates as it is a kind of liability to be settled.
Before any payment of dividend to common stock holders all the dividend accumulated to preference share holders shall be paid.
Here, preference dividend for each year = 10,000 $100
5% = $50,000
Therefore, out of current year dividend 50,000 2 = $100,000 has to be paid to preference shareholders as past year dividend.
In the current year dividend = $145,000 -$100,000 = $45,000
This also will be paid to preference shareholders as their dividend for a year = $50,000
and out of this $50,000 - $45,000 = $5,000 will be due on preference shares in next year.
As this rate of dividend cannot be decreased, and dividend has to be paid at this rate minimum.
Therefore out of $145,000, dividend to preference share holders = $145,000