Preferred Stock Is Considered to Be Non-Participating When

question 105

Multiple Choice

Preferred stock is considered to be non-participating when:

• A) preferred stockholders get their yearly dividend and the remainder goes to common stockholders.
• B) preferred stockholders have a right to the current year's dividend, but do not receive holdovers from past years when dividends were not paid.
• C) preferred stockholders have a right to a certain dividend every year.
• D) None of these answers is correct.

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