The board of directors of Newton Industries is contemplating a dividend of $500,000. The corporation had 60,000 shares of 10 percent, $40 par value cumulative preferred stock outstanding. There were 400,000 shares of $1 par value common stock outstanding at the time Newton declared dividends. Determine the dividends the preferred and common shareholders will receive if the preferred stock is one year in arrears.

a. Not enough information available to calculate dividends

b.Preferred shareholders $240,000 Common shareholders $260,000

c.Preferred shareholders $480,000 Common shareholders $20,000

d.Preferred shareholders $0 Common shareholders $500,000