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Diamond Garde Corporation has $125,000$ shares of $$1\mathrm{.}35$ preferred stock outstanding in addition to its common stock. The $$1\mathrm{.}35$ designation means that the preferred stockholders receive an

annual cash dividend of $$1\mathrm{.}35$ per share. In $2021,$ Diamond Garde declares an annual dividend of $$500,000.$ The allocation to preferred and common stockholders is:

$($Click the icon to view the data.$)$

Read the requirements.

How much in dividends must Diamond Garde declare each year before the common stockholders receive any cash dividends for the year?

Dividends the company must declare each year before the common stockholders receivable any cash dividends $=$

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Requirements

Answer these questions about Diamond Garde's cash dividends.

How much in dividends must Diamond Garde declare each year before the common stockholders receive

any cash dividends for the year?

Suppose Diamond Garde declares cash dividends of $$450,000$ for $2021.$ How much of the dividends goes to

preferred shareholders? How much goes to common shareholders?

Is Diamond Garde's preferred stock cumulative or noncumulative? How can you tell?

Diamond Garde passed the preferred dividend in $2020$ and $2021.$ Then in $2022,$ Diamond Garde declares

cash dividends of $$1,200,000.$ How much of the dividends goes to preferred shareholders? How much goes

to common shareholders?

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