A company has 8,500 shares of $50 par value, 4.50% cumulative and nonparticipating preferred stock and 85,000 shares of $10 par value common stock outstanding. The company paid total cash dividends of $8,500 in its first year of operation. The cash dividend that must be paid to preferred stockholders in the second year before any dividend is paid to common stockholders is:

$8,500

$10,625

$29,750

$38,250

$19,125