Preferred shares differ from common shares in that preferred shares:

Question

Quizplus · Accepted Answer

Preferred shares are given priority over common shares when it comes to receiving dividends. This means that preferred shareholders will receive their dividend first, before any dividends are paid to common shareholders. Preferred shares typically do not have any voting power, as the purpose of owning these shares is to receive a guaranteed dividend payment. Preferred shares may be subject to tax, depending on the country and specific tax laws. Therefore, option B is the correct answer.

Preferred Shares Differ from Common Shares in That Preferred Shares