Which of the Following Statements Is FALSE

question 86

Multiple Choice

Which of the following statements is FALSE?

• A)The preferred stock issued by young companies typically does not pay regular cash dividends.
• B)The preferred stock issued by young companies usually gives the owner an option to convert it to common stock on some future date,so it is often called callable preferred stock.
• C)If the company runs into financial difficulties,the preferred stockholders have a senior claim on the assets of the firm relative to any common stockholders.
• D)Preferred stock issued by mature companies such as banks usually has a preferential dividend and seniority in any liquidation and sometimes special voting rights.

---

Definitions:

Court Decree

A formal and authoritative order issued by a court, requiring parties to do or not do something.

Invalidates

To make something legally null and void or to render it ineffective by establishing its incorrectness or inapplicability.

Community Property

A form of ownership between married couples in some states, where assets acquired during the marriage are considered jointly owned.

Separate Property

Property that a spouse owned before the marriage plus inheritances and gifts acquired by the spouse during the marriage.