Exercise $11-6$A $($Algo$)$ Accounting for cumulative preferred dividends LO $11-3$

When Crossett Corporation was organized in January, Year $1,$ it immediately issued $5,800$ shares of $$52$ par, $5$ percent, cumulative preferred stock and $8,500$ shares of $$13$ par common stock. Its earnings history is as follows: Year $1,$ net loss of $$17,600$; Year $2,$ net income of $$110,000$; Year $3,$ net income of $$106,400.$ The corporation did not pay a dividend in Year $1.$

Required

How much is the dividend arrearage as of January $1,$ Year $2?$

Assume that the board of directors declares a $$48,160$ cash dividend at the end of Year $2($remember that the Year $1$ and Year $2$ preferred dividends are due$).$ How will the dividend be divided between the preferred and common stockholders?