Not Paying Dividends on a Cumulative Preferred Issue May Result

Not paying dividends on a cumulative preferred issue may result in:

A) preferred dividend arrearages that can be eliminated only after all common dividends are paid.
B) increased taxes based on the amount of the dividend arrearage.
C) the permanent forfeiture of all unpaid past dividends but the resumption of future dividends.
D) the issuer being forced into repaying all preferred shareholders the stated value of their shares.
E) voting rights being granted to preferred shareholders.