Regarding the Tax Treatment of Payments to Securities Holders; It

question 52

Multiple Choice

Regarding the tax treatment of payments to securities holders; it is true that ____________ , while___________.

• A) common stock dividends and preferred stock dividends are tax-deductible; interest is not tax deductible
• B) interest and preferred stock dividends are not tax-deductible; common stock dividends are tax deductible
• C) common stock dividends and preferred stock dividends are not tax-deductible; interest is tax deductible
• D) interest and preferred stock dividends are tax-deductible; common stock dividends are not tax deductible

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Definitions:

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