Common stock usually has all of the following features except

Question

Quizplus · Accepted Answer

a. Voting rights: Common stockholders usually have the right to vote on corporate matters, such as the election of the board of directors and significant corporate policies.
b. Preemptive right: This right allows existing shareholders to purchase additional shares before the company offers them to the public, enabling shareholders to maintain their proportional ownership in the company.
c. Residual claim to net assets: In the event of liquidation, common stockholders have a residual claim on the company's assets after all debts and preferred stock obligations have been paid.
d. Conversion privilege: This feature is not typically associated with common stock. Conversion privilege is more commonly a feature of preferred stock or convertible bonds, which allows holders to convert their preferred shares or bonds into a predetermined number of common shares.
Therefore, the correct answer is:
d. Conversion privilege.

Common Stock Usually Has All of the Following Features Except