When Crossett Corporation was organized in January, Year $1,$ It immediately issued $4,200$ shares of $$48$ par, $6$ percent, cumulative preferred stock and $8,000$ shares of $$14$ par common stock. Its earnings history is as follows: Year $1,$ net loss of $$15,000$; Year $2,$ net income of $$121,000$; Year $3,$ net income of $$208,000.$ The corporation did not pay a dividend in Year $1.$

Required

a$.$ How much is the dividend arrearage as of January $1,$ Year $2?$

b$.$ Assume that the board of directors declares a $$53,000$ cash dividend at the end of Year $2($remember that the Year $1$ and Year $2$ preferred dividends are due$).$ How will the dividend be divided between the preferred and common stockholders?

Complete this question by entering your answers in the tabs below.

Required B

Assume that the $[$board of directors declares a $$53,000$ cash dividend at the end of Year $2($remember that the Year $1$ and Year $2$ preferred dividends are due$).$ How will the dividend be divided between the preferred and common stockholders?

$\backslash$table$[[,$Amount,Distributed to Shareholders$],[,$Preferred,Common$],[$Total dividend declared,,,$],[$Year $1$ Arrearage,,,$],[$Year $2$ Preferred dividends,$a^2,,9],[$Available for common,,,$8],[$Distributed to common,,,$],[$Total distribution,,,$]]$