Preferred Stock Differs from Common Stock in That

question 12

Multiple Choice

Preferred stock differs from common stock in that

• A) preferred stock usually has a maturity date.
• B) preferred stock investors have a higher required return than common stock investors.
• C) preferred stock dividends are fixed.
• D) common stock investors have a required return and preferred stock investors do not.

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Definitions:

Expenses

It refers to the outflow of cash or other valuable assets from a person or company to another entity as a result of purchasing goods or services.

Related Revenues

Income that is directly connected to the primary operations or activities of a business.

Revenue

The total income generated by a business from its normal business operations, such as sales of goods or services.

Earned

Income or revenue that has been generated from business activities or services provided.