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50,000 common shares. P13-3B At the beginning of its first year of operations, Backwoods Limited has 3,000, $5 preferred shares and Allocate dividends betwee preferred and common Instructions shares. (LO 2) AP Using the format shown below, allocate the total dividend paid in each year to the preferred and common shareholders, assuming that the preferred shares are (a) noncumulative, and (b) cumulative. (a) (b) Year Dividend Paid Noncumulative Preferred Common Cumulative Preferred Common $15,000 12,000 27,000 35,000 TAKING IT FURTHER Why would an investor choose to invest in common shares if preferred share dividends have a higher priority