If Preferred Stock Is Cumulative, Then

question 82

Multiple Choice

If preferred stock is cumulative, then

• A)preferred dividends are a percentage of corporate profits.
• B)dividends in arrears must be paid before common shareholders receive dividends.
• C)dividends are a percentage of the market value of the preferred stock.
• D)payment of dividends is legally guaranteed to shareholders each year.

---

Definitions:

Cocoa

A powder made from roasted and ground cacao seeds, used in the production of chocolate, as well as in beverages and baking.

Consumption

The process by which goods and services are used up by consumers, reflecting economic activity and individuals' preferences.

Income

Financial gains received from work or investments, usually on a consistent basis.

Demand

The quantity of a good or service consumers are willing and able to purchase at a given price level.