Orleans Company Was Incorporated on January 1, 2012

question 18

Multiple Choice

Orleans Company was incorporated on January 1, 2012. Orleans issued 4,000 shares of common stock and 500 shares of preferred stock on that date. The preferred shares are cumulative, $100 par, with an 8% dividend rate. Orleans has not paid any dividends yet. In 2015, Orleans had its first profitable year, and on November 1, 2015, Orleans declared a total dividend of $28,000. What is the total amount that will be paid out to preferred shareholders?

• A)$4,000
• B)$16,000
• C)$3,200
• D)$28,000