Capital stock of Barr Company includes:

Capital stock:

Common stock, $10 par, 150,000 shares outstanding .....$1,500,000

Preferred stock, 12 percent cumulative, $100 par,

5,000 shares outstanding ................ 500,000

As of December 31, 2009, three years’ dividends are in arrears on the preferred stock. During 2009, Barr plans to pay dividends that total $460,000.

Required:

1. Determine the amount of dividends that will be paid to Barr’s common and preferred stockholders in 2010.

2. If Barr paid $280,000 of dividends, determine how much each group of stockholders would receive.