21) Team Shirts declared and paid cash dividends of $40,000. There were 1,000 shares of 6%, $10 par value, noncumulative preferred stock outstanding. How much of the cash dividends were paid to common...

21) Team Shirts declared and paid cash dividends of $40,000. There were 1,000 shares of 6%, $10 par value, noncumulative preferred stock outstanding. How much of the cash dividends were paid to
common
shareholders?

A) $40,000

B) $39,400

C) $2,400

D) $600

22) Dividends are distributions of a corporation’s earnings to its shareholders.

23) Dividends are an operating expense of a corporation.

24) Dividends decrease net income.

25) Dividends decrease retained earnings.

26) Dividends decrease contributed capital.

27) Preferred stock has preference over common stock when dividends are paid.

28) Common stock has preference over preferred stock when dividends are paid.