From the corporation's point of view, the advantages of issuing preferred stock include all of the following EXCEPT
A) its increased financial leverage.
B) its flexible dividend policy.
C) its excellent merger security.
D) its difficulty to retire.

Question

Quizplus · Accepted Answer

Preferred stock may be difficult to retire for the corporation because it is often issued without a maturity date, meaning it does not have a set date in which the corporation must repay the original investment. This can make it challenging for the corporation to remove the stock from its financial records and can limit its financial flexibility in the future. Therefore, the incorrect option is D, whereas options A, B, and C are correct.

From the Corporation's Point of View, the Advantages of Issuing