Question: Arp Corp.s outstanding capital stock at December 15, 2011, consisted of the following: 30,000 shares of 5% cumulative preferred stock, par value $10 per

Arp Corp.’s outstanding capital stock at December 15, 2011, consisted of the following:

• 30,000 shares of 5% cumulative preferred stock, par value $10 per share, fully participating as to dividends.

No dividends were in arrears.

• 200,000 shares of common stock, par value $1 per share.

On December 15, 2011, Arp declared dividends of

$100,000. What was the amount of dividends payable to Arp’s common stockholders?

a. $10,000

b. $34,000

c. $40,000

d. $47,500

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