Question & Answer: Dividends omitted on preferred shares that must be paid before comm…..

Dividends omitted on preferred shares that must be paid before common shareholders are entitled to be paid are referred to as:

Select one:

a. Participating

b. Callable

c. Cumulative

d. In arrears

Expert Answer

preferred shares have preferrence over the dividends paid to common stockholders.

Dividends omitted on preferred shares that must be paid before common shareholders are entitled to be paid are participating

So the option is A.participating.

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