Question 3 was: Hernandez Corporation has 15,000 shares of 10%, $50 par cumulative preferred stock outstanding and 25,000 shares of no-par common stock outstanding. Dividends of $37,500 are in arrears.

Question 3 was: Hernandez Corporation has 15,000 shares of 10%, $50 par cumulative preferred stock outstanding and 25,000 shares of no-par common stock outstanding. Dividends of $37,500 are in arrears. At the end of the current year, the corporation declares a dividend of $120,000. How is the dividend allocated between preferred and common shareholders? and these were the answer choices: a) The dividend is allocated $7,500 to preferred shareholders and $112,500 to common shareholders. b) The dividend is allocated $112,500 to preferred shareholders and $7,500 to common shareholders. c) The dividend is allocated $120,000 to preferred shareholders and no dividend is paid to common shareholders. d) The dividend is allocated $75,000 to preferred shareholders and $45,000 to common shareholders. How the heck did they come up with $14,200? What is the real solution and how do I get to it?

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