One advantage of using common stock as a source of funds is that common stock does not legally obligate the firm to make payments to stockholders.

Name: One advantage of using common stock as a source of funds is that common stock does not legally obligate the firm to make payments to stockholders.
Brand: Quizplus
Rating: 4.9 (56 reviews)

Question

Quizplus · Accepted Answer

Common stock represents ownership in the company and does not require payment of dividends to stockholders. It only entitles them to a share in profits and voting rights.

One Advantage of Using Common Stock as a Source of Funds