The preference to dividends that preferred shareholders have is
A) the right to receive the appropriate dividend before common shareholders are paid any dividends when dividends are declared.
B) the right to accumulate dividends that have not been declared.
C) the right to share dividends equally with common shareholders when dividends are declared.
D) the right to be paid a minimum dividend each year.

Question

Quizplus · Accepted Answer

Preferred shareholders have the right to receive dividends before common shareholders when dividends are declared, reflecting their preferential treatment in the distribution of a company's earnings.

The Preference to Dividends That Preferred Shareholders Have Is