Assuming that there are no dividends in arrears, how are total dividends allocated between ordinary shares and preference shares?

Question

Quizplus · Accepted Answer

Preference shareholders have the right to receive their required dividends before any dividends can be paid to ordinary shareholders. Therefore, assuming there are no dividends in arrears, the required annual dividend for preference shares must be paid first. Any remaining dividends can then be allocated to ordinary shareholders.

Assuming That There Are No Dividends in Arrears, How Are