Cash Dividends Steeple Company paid total cash dividends of $212,000 in 2001 after forgoing dividend payments in 1999 and 2000. The company authorized 25,000 shares of $20-par value 8 percent cumulative preferred stock on January 1, 1996, and immediately issued some of the shares at par value. Steeple also issued 40,000 shares of its

$6-par value common stock on that date. If the cash dividend paid to common shareholders in 2001 was $3.50 per share, how many preferred shares were outstanding during 2001?