Question 3 Participating Preferred Shares (5 marks) The shareholders' equity section of a firm's balance sheet reflects the following at the end of the current year: $300,000 $500,000 Preferred shares, $6, cumulative, fully participating, 3,000 shares outstanding Common Shares, 100,000 shares outstanding (Matching dividend, if applicable, $.30) The preferred shares fully participate based on the relative annual total base dividend for the current year, once the common shareholders receive their match. There were two years of dividends in arrears on the preferred shares at the beginning of the current year. The firm declares $110,000 in dividends at the end of the current year. Required: Prepare a schedule to show how dividends will be allocated this year. State the total amount of dividends to be allocated to each share class