Dividends in arrears occur when the company does not pay dividends to:

Question

Quizplus · Accepted Answer

Dividends in arrears typically refer to unpaid dividends on cumulative preferred stock. Cumulative preferred stockholders have the right to receive any missed dividend payments in the future, whereas non-cumulative preferred stockholders do not have this right. Participating preferred stockholders receive additional dividends on top of the stated dividend rate, while non-participating common stockholders do not receive any preference with regards to dividend payments.

Dividends in Arrears Occur When the Company Does Not Pay