Which of the following provisions will call for the repurchase and retirement of a given percentage of the preferred stock each year?

Question

Quizplus · Accepted Answer

A sinking fund provision requires the issuer to set aside money each year to repurchase and retire a certain percentage of the preferred stock. This can help limit the issuer's liability and reduce the risk for investors. Participation, cumulative dividends, preemptive rights, and call provisions do not involve repurchasing or retiring shares of preferred stock.

Which of the Following Provisions Will Call for the Repurchase