If the Preferred Stock of a Corporation Is Cumulative

question 105

Multiple Choice

If the preferred stock of a corporation is cumulative:

• A)Dividends on preferred stock are guaranteed.
• B)Dividends cannot be declared in an amount less than that stated on the stock certificate.
• C)Preferred stockholders participate in dividends paid in excess of a stated amount on the common shares.
• D)Dividends in arrears must be paid on preferred stock before any dividend can be paid on common stock.

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