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Right or Attribute of Preferred Stocks

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Which of the following is not usually a right or attribute of preferred stock?

a) Having a claim to dividends in excess of the annual dividend requirement if dividends on common stock exceeds dividends on preferred stock
b) Having a priority claim to dividends relative to the common stock's claim to dividends
c) Having a priority claim in liquidation relative to the common stock;s claim in liquidation
d) Having a claim to dividends that is cumulative over time if the annual dividend requirement is not satisfied

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This solution discusses the rights and attributes of preferred stock.

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The answer is a) Having a claim to dividends in excess of the annual dividend requirement if dividends on common stock exceeds dividends on preferred stock.

Preferred stock is given that name because preferred stockholders have a priority claim to dividends relative to the common stock's claim to dividends (i.e., if the ...

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