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?

Fixed dividend payments

Preference over common stock in dividend distribution

Priority claim on assets in the event of liquidation

Voting rights similar to common stockholders

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Verified step by step guidance

Understand the nature of preferred stock: Preferred stock is a type of equity security that typically has characteristics of both debt and equity. It is important to note that preferred stockholders generally do not have voting rights, unlike common stockholders.

Review the fixed dividend payments characteristic: Preferred stockholders are often entitled to fixed dividend payments, which are paid before any dividends are distributed to common stockholders. This is a key feature of preferred stock.

Examine the preference in dividend distribution: Preferred stockholders have a higher claim on dividends compared to common stockholders. This means they receive dividends before common stockholders do.

Analyze the priority claim on assets in liquidation: In the event of liquidation, preferred stockholders have a priority claim on the company's assets over common stockholders, but they rank below debt holders.

Identify the least likely characteristic: Preferred stockholders typically do not have voting rights similar to common stockholders. Voting rights are generally reserved for common stockholders, making this the least likely characteristic of preferred stock.