Arias, Inc. has 1,000 shares of 5%, $100 par value cumulative preferred stock and 10,000 shares of $1 par value common stock outstanding. The company has not paid dividends in two years. In its third year, it paid the common shareholders a $2 per-share dividend, plus the amount owed to preferred shareholders.

What is the total amount of dividends paid?

ANSWER

• $35,000

• $20,000

• $20,150

• $30,000