Allstate, Inc., has 10,000 shares of 6%, $100 par value, noncumulative preference shares and 100,000 ordinary shares with a $1 par value outstanding at December 31, 2011.If the board of directors declares a $200,000 dividend, the

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The preference shareholders are entitled to a fixed 6% dividend on their $100 par value shares, which equals $6 per share. With 10,000 preference shares outstanding, the total preferred dividend amount is $60,000 (10,000 shares x $6 per share). The remaining $140,000 ($200,000 - $60,000) will be distributed to the ordinary shareholders. Therefore, preference shareholders will receive $60,000 and the ordinary shareholders will receive $140,000.