York’s outstanding stock consists of 80,000 shares of cumulative 7.5% preferred stock with a $5 par value and also 200,000 shares of common stock with a $1 par value. During its first four years of operation, the corporation declared and paid the following total cash dividends:

2015 $ 20,000
2016 28,000
2017 200,000
2018 350,000
Determine the amount of dividends paid each year to each of the two classes of stockholders assuming that the preferred stock is cumulative. Also determine the total dividends paid to each class for the four years combined. (Round your "Dividend per Preferred Share" answers to 3 decimal places.)

When the preference dividends are cumulative in nature the dividends shall be paid each year of the rate specified, in case not paid the, it is carried forward.

In the given case, preference dividend = 80,000 shares [tex]\times[/tex] $5 [tex]\times[/tex] 7.5% = $30,000

Thus, in 2015

Dividend to preference = $20,000

Dividend to Equity = $0

Also $30,000 - $20,000 = $10,000 shall be carried forward.

2016

Dividend to preference = $10,000 Arrears

Current year = $28,000 - $10,000 = $18,000

Carry forward = $30,000 - $18,000 = $12,000

Dividend to Equity = $0

2017

Dividend to preference = $12,000 Arrears

Current year = $30,000

Dividend to Equity = $200,000 - $30,000 - $12,000 = $158,000

2018

Dividend to preference = $30,000

Dividend to Equity = $350,000 - $30,000 = $320,000