The claims of common and preferred stockholders on the assets of a firm take preference over those of the creditors in the event of default on a contractual obligation.

Name: The claims of common and preferred stockholders on the assets of a firm take preference over those of the creditors in the event of default on a contractual obligation.
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The claims of creditors take precedence over the claims of stockholders in the event of default on a contractual obligation.

The Claims of Common and Preferred Stockholders on the Assets