Which of the following is true regarding a firm's securities?
A) Common dividends are paid before preferred dividends.
B) Preferred stockholders have voting rights.
C) Preferred dividends are usually cumulative.
D) Preferred dividends are contractual obligations.
E) Common dividends can usually be paid if preferred dividends have been skipped.

Question

Quizplus · Accepted Answer

Preferred dividends are typically cumulative, meaning if any dividends are missed, they must be paid out before common dividends can be distributed.

Which of the Following Is True Regarding a Firm's Securities