Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

12. Stockholders' Equity

Preferred Stock

Financial Accounting

12. Stockholders' Equity

Preferred Stock

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Multiple Choice

Preferred stock is least likely to have which of the following characteristics?

Voting rights similar to common stockholders

Preference in asset distribution upon liquidation

Fixed dividend payments

Priority over common stock in dividend distribution

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Verified step by step guidance

Step 1: Understand the characteristics of preferred stock. Preferred stock is a type of equity that typically has features distinct from common stock, such as fixed dividend payments and priority in dividend distribution.

Step 2: Analyze the concept of voting rights. Unlike common stockholders, preferred stockholders generally do not have voting rights in corporate decisions. This is a key distinction between preferred and common stock.

Step 3: Examine the preference in asset distribution upon liquidation. Preferred stockholders have a higher claim on assets than common stockholders in the event of liquidation, which is a common characteristic of preferred stock.

Step 4: Review the fixed dividend payments feature. Preferred stock often comes with fixed dividend payments, which are paid before any dividends are distributed to common stockholders.

Step 5: Compare the options provided in the question. The characteristic least likely to apply to preferred stock is 'Voting rights similar to common stockholders,' as preferred stockholders typically do not have voting rights.