ABC, Inc., has $500,000 of 5% preferred stock and $1,500,000…
ABC, Inc., has $500,000 of 5% preferred stock and $1,500,000 of common stock outstanding, each having a par value of $10 per share. No dividends were paid during 2023 and 2024. During 2025, ABC declared a $300,000 dividend. Required: How will the dividend be allocated between preferred and common stockholders if the preferred stock is cumulative and fully participating?