The books of Conchita Corporation carried the following account balances as of December 31, 2010.

Cash $195,000

Preferred Stock 6% cumulative , non participating, $50 par $300,000

Common Stock, no Par value $300,000 shares issued $1,500,000

Paid in Capital in excess of par (preferred) $150,000

Treasury Stock (common 2800 shares at cost) $33,600

Retained Earnings $105,000

The company decided no to pay any dividends in 2010. The Board of directors on Dec. 21,2011 declared the following : current year dividends at 6% on preferred and $ .30 per share on common. The dividends in arrears should be paid by issuing 1,500 shares of treasury stock. At the date of declaration, the preferred is selling at $80.00 per share, and the common at $12.00 per share. Net Income for 2011 is estimated at $77,000.

Prepare the journal entries required for the dividend declaration and payment assuming that they occur simultaneously.

Could Conchita Corp. give the preferred stock holders 2 years dividends and common stock holders $ .30 cents per share dividends, all in cash?