Which of the Following Is NOT One of the Many

question 109

Multiple Choice

Which of the following is NOT one of the many differences between long-term debt and preferred stock?

• A) Long-term debt pays interest, which is tax-deductible to the borrower.
• B) Preferred stockholders are paid before creditors if the company bankrupts.
• C) Preferred stockholders are considered non-voting owners of the company.
• D) The firm is not legally required to pay preferred stock dividends but must pay interest to creditors.

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