You were getting the impression that your work at Jelly was ending when Mr. Kount came up with a one last one please. He wanted all issues related to dividends to be cleared up once and for all. He said he had some arguments with the internal auditor who thought all of Mr. Kounts computations were incorrect. I could lose my job over this.

Jelly has a large operation in Murdochville, QC which is run under a separate corporate entity, Gelato Inc., and an independent local management team. However, all strategic decisions are made by the home company. Gelato reported a capital structure of 1 million common shares with a contributed capital of $9,000,000; and 200,000 cumulative preferred shares with a contributed capital of $5,000,000. Preferred shareholders would receive a minimum annual dividend of 5% but held participative rights in the distribution of excess dividends once common shareholders receive 0.70 per common share. The last dividends declared by Gelato was in 2017.

In view of the excellent earnings for the past two years, Gelato management decided to declare a dividend for 2021 in the amount of $2.4 million. Mr. Kount took a quick glance at the figures submitted by you and drew a long sigh of relief. I am so glad you saved my job, he stated gratefully.

Required: You were asked to prepare a well formatted schedule showing the following:

a] The total amounts payable to each group of shareholders.