Question 11
Business FinanceWhich of the following statements is true of preferred stockholders?
- A.They have no voting rights at annual general meetings
- B.They have first claim to company assets before creditors
- C.They have first claim to company assets after all debts have been settled
- D.They share dividends equally with common stockholders.
Show the answer and explanation
Answer: A (They have no voting rights at annual general meetings)
Explanation
Preference shareholders normally do not vote at general meetings in return for their fixed, prior dividend.