Which of the following statements about preferred stock is false? Multiple choice question. Preferred stock is sometimes convertible into debt. Preferred stock is often callable by the issuer. Preferred stock often carries a credit rating. Preferred stock pays a stated dividend.

Which of the following statements about preferred stock is false? Multiple choice question. Preferred stock is sometimes convertible into debt. Preferred stock is often callable by the issuer. Preferred stock often carries a credit rating. Preferred stock pays a stated dividend.

Principles of Accounting Volume 1

19th Edition

ISBN:9781947172685

Author:OpenStax

Publisher:OpenStax

Chapter14: Corporation Accounting

Section: Chapter Questions

Problem 1MC: Which of the following is not a characteristic that sets preferred stock apart from common stock? A....

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Question

Which of the following statements about preferred stock is false?

Multiple choice question.

Preferred stock is sometimes convertible into debt.

Preferred stock is often callable by the issuer.

Preferred stock often carries a credit rating.

Preferred stock pays a stated dividend.

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Similar questions

Answer the multiple-choice question below: 1. Which of the following is/are incorrect about the characteristics of preferred stock: I.It has a fixed maturity date II.Dividends are tax-deductible III.Dividend payments vary just like common stock IV.Can be easily converted to a number of common stock Select one: a. I and II only b. I only c. I, II, and III only d. All of the above
Which of the following statements correctly describe characteristics of preference shares? Group of answer choices A. The required return on preference equity is expected to be less than the required return from ordinary equity. B. None of the other statements are correct C. A participating preference share participates in the interest payments paid to debtholders. D. Preference shares are called “hybrid” securities because they display characteristics of both short-term and long-term debt.
Question: f. accounting
Which of the following statements is false? a. the common stock account has a credit balance. b. the additional paid-in capital account has a credit balance. c. common stock may be issued for more than par value. d. the par value of common stock represents the stock's market value.
Match each of the following preferred stock features with its description.Preferred Stock Features Description 1. Convertible a. Prior unpaid dividends receive priority. 2. Redeemable b. Shares can be sold at a predetermined price. 3. Cumulative c. Shares can be exchanged for common stock.
Which is not true of preference shares? * A. Payment of dividends is mandatory if cumulative. B. Preference shares are convertible to ordinary shares or bonds. C. It is similar to debt financing in terms of limited cost payment. D. Cost is higher than cost of bonds.
Which of the following is not a very common feature of preferred stock? a. Voting rights b.The conversion feature c. Call feature d. Cumulative dividends
Identify the reasons due to which preferred stock is often considered debt in disguise. More than one answer may be correct. Multiple select question. Preferred stocks are not transferable. Preferred shareholders do not receive any returns over and above the stated return. Preferred stocks carry credit ratings. Preferred stocks are not callable.
How does preferred stock differ from bothcommon equity and debt? Is preferred stock morerisky than common stock? What is floating ratepreferred stock?
Question 4:(a) What are the principal differences between common stock and preferred stock?(b) Preferred stock may be cumulative. Discuss this feature.(c) How are dividends in arrears presented in the financial statements?
Preferred stock is a special form of stock having a fixed periodic dividend that must be paid prior to payment of any interest to outstanding bonds. Is this true or false?
Preferred stocks are characterized by all the following, except a. the dividends declared for the investors of these stocks are tax deductible to the issuer b. may be convertible to ordinary or common stock c. voting rights are generally not present and not given to the holders of these stocks d. warrants may be attached to these securities