Sara Corporation was organized on January 1, 2017. During its first year, the corporation issued 40,000 shares of $5 par value preferred stock and 400,000 shares of $1 par value common stock. At December 31, the company declared the following cash divie 2017 10000.00 2018 $30,000 2019 $70,000 Instructions (a) Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 6% and not cumulative. (b) Show the allocation of dividends to each class of stock, assuming the preferred stock dividend is 8% and cumulative. (c) Journalize the declaration of the cash dividend at December 31, 2019 using the assumption of part (b). (d) Explain the difference between cumulative or noncumulative stocks. Solution (d) cumulative stocks noncumulative stocks Solution (a) 2017 2018 Solution (b) 2017 Item 2019 Item 2018 2019 Solution (C) Debit Credit Accounts