A Company Has 1,000 Shares of $50 Par Value,4

Multiple Choice

A company has 1,000 shares of $50 par value,4.5% cumulative and nonparticipating preferred stock and 10,000 shares of $10 par value common stock outstanding.The company paid total cash dividends of $1,000 in its first year of operation.The cash dividend that must be paid to preferred stockholders in the second year before any dividend is paid to common stockholders is:

A) $1,000.
B) $1,250.
C) $2,250.
D) $3,500.
E) $4,500.