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Which of the following statements is CORRECT? Preferred stockholders have a priority over bondholders in the event of bankruptcy to the income, but not to the proceeds in a liquidation. The preferred stock of a given firm is generally less risky to investors than the same firm's common stock. Corporations cannot buy the preferred stocks of other corporations. Preferred dividends are not generally cumulative.

Respuesta :

TomShelby

Answer:

(B) The preferred stock of a given firm is generally less risky to investors than the same firm's common stock

Explanation:

(A) preferred shareholders have the rights to company assets first FALSE

(B) the preferred shareholders receive dividends before the common stock, and their dividend can be cumulative over time. So their risk is lower than common stock. TRUE

(C) corporation can purchase the preferred stock of other corporation FALSE

(D) the preferred dividends can be cumulative FALSE

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