Preferred shares are often referred to as hybrid securities-a hybrid between debt and common shares.
Instructions
Discuss the features of a preferred share that make it resemble debt and explain why it is normally recorded in the equity section of the Statement of Financial Position. Why would a company choose to issue preferred shares?

Question

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The Answer of Preferred shares are often referred to as hybrid securities-a hybrid between debt and common shares.
Instructions
Discuss the features of a preferred share that make it resemble debt and explain why it is normally recorded in the equity section of the Statement of Financial Position. Why would a company choose to issue preferred shares?

Preferred Shares Are Often Referred to as Hybrid Securities-A Hybrid