Participating Preference Shares Require That If a Company Fails to Pay

question 53

True/False

Participating preference shares require that if a company fails to pay a dividend in any year, it must make it up in a later year before paying any ordinary dividends.

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Definitions:

Beta

A unit of measurement for the swings, or integral risk, experienced by a security or portfolio in relation to the wider market.

Common Stock

An equity investment representing ownership in a company, entitling holders to vote at shareholder meetings and receive dividends.

Weighted Average Cost

A method of calculating the total cost of goods sold or assets that weighs each item's cost proportionately.

Face Value

The original value or principal amount of a security as stated by the issuer.