Which Statement Regarding Preference Shares Is Correct

question 45

Multiple Choice

Which statement regarding preference shares is correct?

• A)Preference shares typically carry voting rights.
• B)Preference shares continue to be a major source of new finance for companies.
• C)Preference shareholders do not have the right to receive dividends prior to dividends being paid to ordinary shareholders.
• D)Dividends paid on preference shares are not normally tax deductible to the business.

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Definitions:

U.S. Firm

A company or business incorporated or conducting significant operations in the United States.

U.S. Dollars

The official currency of the United States, symbolized as $ and also known as USD.

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Large retail establishments offering a wide range of products across multiple departments.

Ad Valorem Duty

A tax charged as a percent of the value of the item.