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Nadal, Inc. has 78,750 shares of $10 par value common stock and 52,500 shares of $10 par value 4%, cumulative, participating

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Answer #1

Solution: $283,000

Explanation: Before distributing the dividends to the common stockholders, the preferred dividends need to be paid first for the arrears and the current year. Thus the common stockholders will receive

= 325,000 - (52,500 shares * $10 * 4% * 2 years)

= 325,000 - 42,000

= 283,000

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