A particular issue of stock carries a stated dividend rate of 8 %; - 2675

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Request Description

A particular issue of stock carries a stated dividend rate of 8 %; that if this dividend is not paid during a particular year, it will be paid in a subsequent year before common stock dividends are paid; and that upon liquidation of the corporation, the owner will receive $300 per share before the common stockholders get anything. This stock is 

A. common stock 

B. preferred stock 

C. noncumulative preferred stock with a liquidation preference 

D. cumulative preferred stock with a liquidation preference 

 
Solution Description

 A particular issue of stock carries a stated dividend rate of 8 %; that if this dividend is not paid during a particular year, it will be paid in a subs