Q882
Preferred stock dividends must be paid on common stock and must have
A.
fixed amount of dividends
AnswerB.
fixed amount of shares
C.
variable amount of dividends
D.
variable amount of shares
Answer: Option A
Solution
Answer: Option A
Solution:
Preferred stock dividends must be paid on common stock and must have fixed amount of dividends. Preferred dividends are the dividends that are accrued paid on a company's preferred stock. Any time a company pays dividends, preferred shareholders have priority over common shareholders, which means dividends must always be paid to preferred shareholders before they are paid to common shareholders.