When Crossett Corporation was organized in January Year 1, it immediately issued 6,000 shares of $49 par, 8 percent, cumulative preferred stock and 9,000 shares of $10 par common stock. Its earnings history is as follows: Year 1, net loss of $12,200; Year 2, net income of $59,900; Year 3, net income of $119,100. The corporation did not pay a dividend in Year 1. Required

1. How much is the dividend arrearage as of January 1, Year 2?
2. Assume that the board of directors declares a $60,540 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