In the event of a corporate liquidation,preferred stockholders ________.
A) are guaranteed to receive a full refund of the stock purchase price
B) have first claim on remaining corporate assets after debts are paid
C) are guaranteed to receive the par value of the preferred stock
D) may retain their proportionate share of voting rights

Question

Quizplus · Accepted Answer

Preferred stockholders have a preferred claim on remaining corporate assets after debts are paid, which means they have a priority over common stockholders. However, they are not guaranteed to receive the full refund of the stock purchase price, nor are they guaranteed to receive the par value of the preferred stock. As for voting rights, it depends on the terms of the preferred stock offering.

In the Event of a Corporate Liquidation,preferred Stockholders ________