Which of the following statements is NOT true about preferred stock?
A) Preferred dividend payments are paid by the issuer with after-tax dollars.
B) Preferred dividends are tax deductible just like the interest payments on bonds.
C) Preferred stock holders have limited voting privileges relative to common-stock owners.
D) Preferred stocks are generally viewed as perpetuities because they have no fixed maturity.

Question

Quizplus · Accepted Answer

Preferred dividends are not tax deductible like the interest payments on bonds. Therefore, statement B is not true.

Which of the Following Statements Is NOT True About Preferred