Which of the Following Is  NOT  True with Respect to Preferred

question 29

Multiple Choice

Which of the following is  NOT  true with respect to preferred stock?

• A)Preferred stock usually does not allow for significant voting rights.
• B)If the firm does not have sufficient earnings to pay the preferred stock dividends, the preferred shareholders may force the firm into bankruptcy.
• C)Normally, the owners of preferred stock do not participate in the profits of the firm beyond the stated fixed annual dividend.
• D)Payment of preferred dividends is not a tax-deductible expense.
• E)All of these are correct.

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