All of the following are characteristics of common stock except the: ability to

Question

All of the following are characteristics of common stock except the:

ability to vote for corporate directors.

ability to vote on key issues such as a merger.

c) priority over other equity in a bankruptcy proceeding.

d )right to share proportionally in dividends paid to common shareholders.

right to share proportionally in any residual value in a bankruptcy proceeding.

ability to vote for corporate directors.

ability to vote on key issues such as a merger.

c) priority over other equity in a bankruptcy proceeding.

d )right to share proportionally in dividends paid to common shareholders.

right to share proportionally in any residual value in a bankruptcy proceeding.

Explanation / Answer

Solution :

Common stock holders or the equity share holders are also called as an owner of the company. The ownership is proportionate to no. of shares held by share holders. Being the owner of the company common stock holder enjoys following priviliges:

a. right to caste vote in selection of corporate director

b. fundamental changes affecting the company like merger and acquisition

d. right to receive dividend which is proportinate to their share holdings

e. right to share proportionally in any residual value in a bankruptcy proceeding

Except in case of bankruptcy,

Where The priority is given to Creditors and Preferred stock holder over common stock holders during bankruptcy proceeding

Related Questions

Navigate

• Browse (All)
• Browse A
• Subjects

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.