Halverstein Company's outstanding stock consists of 12,250 shares of cumulative 5% preferred stock with a $10 par value and 5,250 shares of common stock with a $1 par value. During the first three years of operation, the corporation declared and paid the following total cash dividends.

	Dividend Declared
Year 1	$	0
Year 2	$	10,500
Year 3	$	44,000

The amount of dividends paid to preferred and common shareholders in Year 2 is:

Multiple Choice

• $6,125 preferred; $4,375 common.

• $7,350 preferred; $3,150 common.

• $10,500 preferred; $0 common.

• $5,250 preferred; $5,250 common.

• $0 preferred; $10,500 common.