Use the following information for questions. Riga Ltd.has outstanding 100,000 no par common shares and 20,000 no par, $0.40, preferred shares issued at $5 each.The preferred shares are cumulative and non-participating.Dividends have been paid every year except the past two years and the current year.
-The Common Shares account currently shows a balance of $200,000.Assuming that $61,000 will be distributed as a dividend in the current year, and the preferred shares are also fully participating, how much will the common shareholders receive?

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The preferred shareholders are owed dividends for the past two years and the current year, totaling $24,000 (20,000 shares x $0.40 x 3 years). After paying the preferred shareholders, $37,000 remains for the common shareholders.

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