If a Preferred Stock Is of the Cumulative Type

question 16

Multiple Choice

If a preferred stock is of the cumulative type,

• A)dividends must be paid on an equal basis with common stock, so long as earnings permit.
• B)dividends cannot be passed if they are earned.
• C)the cumulative voting rule applies in the exercise of the voting privilege.
• D)unpaid dividends of one period must be carried forward and paid in subsequent periods before anything can be paid to common stockholders.

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Definitions:

Routine Tests

Routine tests are standard medical or diagnostic examinations that are performed on a regular basis to monitor and maintain an individual's health.

Public Behavior

Actions or conduct exhibited by individuals in social settings or amongst the general public.

Assent

Agreement or approval, often used in the context of minors or others not able to give legal consent.

Minor

A term often used to describe something of lesser importance, size, or degree, or individuals under the age of legal adulthood.