Pecan Theatre Inc. owns and operates movie theaters throughout Florida and Georgia. Pecan Theatre has declared the following annual dividends over a six-year period: Year 1, $24,000; Year 2, $48,000; Year 3, $130,000; Year 4, $144,000; Year 5, $154,000; and Year 6, $168,000.

During the entire period ended December 31 of each year, theoutstanding stockof the company was composed of 30,000 shares ofcumulative preferred2% stock, $100par, and 100,000 shares of common stock, $20 par.