Which statement about shares is not correct?
A)Common shares represent the ownership interest of the company.
B)Any share that is not a common share is a preferred share.
C)A company can have as many classes of common shares as it wishes.
D)Preferred shares represent the residual interest of the company.

Question

Quizplus · Accepted Answer

Preferred shares do not represent the residual interest of the company. Instead, they have a fixed dividend rate and are paid out before common shareholders in the event of bankruptcy or liquidation.

Which Statement About Shares Is Not Correct