. With regard to preferred shares, a.their issuance provides no flexibility to the issuing company because their terms always require mandatory dividend payments. b.their shareholders may have the right to participate, along with common shareholders, if a dividend is declared. c.no dividends are expected by the shareholders. d.there is a legal requirement for a corporation to declare a dividend on preferred shares.
. With regard to preferred shares, a.their issuance provides no flexibility to the issuing company because their terms always require mandatory dividend payments. b.their shareholders may have the right to participate, along with common shareholders, if a dividend is declared. c.no dividends are expected by the shareholders. d.there is a legal requirement for a corporation to declare a dividend on preferred shares.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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7. With regard to
a.their issuance provides no flexibility to the issuing company because their terms always require mandatory dividend payments.
b.their shareholders may have the right to participate, along with common shareholders, if a dividend is declared.
c.no dividends are expected by the shareholders.
d.there is a legal requirement for a corporation to declare a dividend on preferred shares.
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