When a company has issued both preferred and common stock,the common stockholders receive their dividends first.

Question

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Preferred stockholders have priority when it comes to receiving dividends. They are entitled to receive a fixed dividend at a specified rate before any dividends are paid to common stockholders. Only after the preferred dividend has been paid in full can any residual earnings be distributed to holders of common stock.

When a Company Has Issued Both Preferred and Common Stock,the