Equity claims representing ownership of the net income and assets of a corporation that receive a ______dividend before common stockholders are entitled to anything are called preferred stock.

Question

Quizplus · Accepted Answer

Preferred stockholders are entitled to receive a fixed dividend before common stockholders in the event of distribution of profits. This fixed dividend is usually expressed as a percentage of the par value of the preferred stock. Variable or random dividends are not typical for preferred stock.

Equity Claims Representing Ownership of the Net Income and Assets