Alien World reported the following financial information as at December 31, 2018:

Common capital: 250,000 shares no par issued and outstanding$1,000,000

Preferred capital: 8% 50,000 shares $ 250,000

Retained earnings $ 700,000

Alien World reported a loss of $127,000 for the year. The shares mentioned above were outstanding throughout 2018. The company declared and paid cash dividends of $105,000 for 2018. Dividends had been declared every year except for the two years prior to the current year. [32] Continue with the same general information given above. However, now ASSUME that for this question only that the preferred shares were cumulative and participating in excess distributable dividends after allocating common shareholders a minimum dividend of $0.50 per share. How much will each shareholder group receive?

Select one:

a.

$69,000 to Preferred and $36,000 to Common

b.

$40,000 to Preferred and $65,000 to Common

c.

All $105,000 to Common since there are no excess dividends given

d.

$60,000 to Preferred and $45,000 to the Common

e.

Company cannot pay any dividends since it made a loss in 2018