If preferred stock possesses a cumulative dividend preference and $50,000 of dividends are in arrears from prior years, the preferred shareholders

will receive the total amount of dividend in arrears, then the current years dividends, and then the common stockholders will receive the remaining amount of dividends declared and paid

will only receive this years dividends, then the common stockholders will receive the remaining amount of the dividends declared and paid

must wait until the common stockholders receive their annual dividend, then they are entitled to be paid the dividends in arrears

None of these statements are true.