Common stockholders have voting rights in the corporation and are paid a variable dividend after preferred stock holders have been paid a fixed dividend. However, the corporation may choose not to pay a dividend to common stockholders even if there are retained earnings. Therefore, all of the choices are correct.

Solved

Common Stockholders

Question 58

Multiple Choice

Common stockholders

A) are paid a variable dividend after preferred stock holders have been paid a fixed dividend.
B) have voting rights in the corporation.
C) may or may not be paid a dividend even if the firm has retained earnings.
D) All of the above are correct.

Correct Answer: