A preferred share on which the right to receive dividends is lost for any year that the dividends are not declared is a:
A) Convertible preferred share.
B) Cumulative preferred share.
C) Noncumulative preferred share.
D) Participating preferred share.
E) Callable preferred share.

Question

Quizplus · Accepted Answer

Noncumulative preferred shares do not accumulate unpaid dividends. If dividends are not declared in a given year, the right to receive them is lost.

A Preferred Share on Which the Right to Receive Dividends