You Own One Share of a Cumulative Preferred Stock Which

question 106

Multiple Choice

You own one share of a cumulative preferred stock which pays quarterly dividends.The firm has recently suffered some financial setbacks and has failed to pay the last two dividends.However,new funding has been arranged and the firm intends to restore all dividends,both common and preferred,this quarter.As a preferred shareholder,you should expect to receive the equivalent of ____ quarter(s) of dividends when the next dividend is paid.

• A)0
• B)1
• C)2
• D)3
• E)either 1, 2, or 3

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Definitions:

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