Cumulative dividends are:
A)payable on preference shares.
B)carried forward.
C)paid before the ordinary shareholders can receive anything.
D)All of the above.
E)None of the above.

Question

Quizplus · Accepted Answer

Cumulative dividends are features of preferred shares that require dividends to be paid to preferred shareholders before common shareholders can receive any dividends. These dividends accumulate if not paid in a given year, and must be paid out before any dividends can go to common shareholders, hence they are payable on preference shares, carried forward, and paid before ordinary shareholders can receive anything.

Cumulative Dividends Are