If preferred stock is non-cumulative, then the company does NOT need to pay dividends that were passed in previous years.

Name: If preferred stock is non-cumulative, then the company does NOT need to pay dividends that were passed in previous years.
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Question

Quizplus · Accepted Answer

Non-cumulative preferred stock does not accumulate any unpaid dividends, so if the company chooses not to pay a dividend in a certain year, it is not required to make up for it in future years.

If Preferred Stock Is Non-Cumulative, Then the Company Does NOT