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Preference Shares Are Sometimes Regarded as a Debt Security Because

Question 7

Multiple Choice

Preference shares are sometimes regarded as a debt security because:


A) legally preference shares are a debt security.
B) preference shareholders receive a residual value and not a stated value.
C) preference dividends are paid out of before-tax income just like interest payments on bonds.
D) preference share dividend payments,like bond interest payments are considered fixed obligations for the company.

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