Preference over common stockholders in terms of dividends

Assignment Help Financial Management

Reference no: EM13921923

Which of the following statements is FALSE?

a. Preferred stockholders have preference over common stockholders in terms of dividends.

b. If a preferred dividend is missed, the firm is technically in default.

c. SEC may allow firms to issue different classes of common shares that differ in voting rights.

d. Minority representation is more likely to happen with a cumulative voting system than with a straight voting system.

Reference no: EM13921923

Questions Cloud

Annual dividend is maintained at the same level : A company just paid out an annual dividend of $2. If the annual dividend is maintained at the same level for the next 5 years, and grows at 5% annually thereafter, what should be the price of a share today? Assume that the required rate of return for..

Assume that all entries for accrual and payment of interest : Prepare the journal entries to record the bond issue on January 1, 2013, and the bond redemption on December 31, 2017. Assume that all entries for accrual and payment of interest were recorded correctly.

About the issued bonds rate : Diesel company issued bonds with 12% coupon rate, semiannual coupon, $1,000 par value. Bonds mature in 40 years and are callable 5 years from now at $1120. Bonds are sold today at a price of $1300, and the yield curve is ownward sloping. What type of..

What is its yield to maturity-coupon payment paid annually : Samuelson Company just issued a 20-year bond that pays $90 coupon payment paid annually. The fave value of the bond is $1,000. If the bond is being sold at $1,152.92, what is its yield to maturity?

Preference over common stockholders in terms of dividends : Preferred stockholders have preference over common stockholders in terms of dividends. If a preferred dividend is missed, the firm is technically in default. SEC may allow firms to issue different classes of common shares that differ in voting rights..

Write a memo explaining whether the total cash out flow : Write a memo explaining whether the total cash out flow for interest would be more, less, or the same, if the bonds pay semiannual versus annual interest.

Assume that the required rate of return for this stock : A company just paid out an annual dividend of $5. The dividend amount will grow at 3%annually forever, e.g., next year's dividend amount will be $5.15 and so on. If you buy a share today and sell it at year 5, how much of a capital gain (not includin..

Drawbacks of accumulating cash balances : What are the benefits and drawbacks of accumulating cash balances rather than paying dividends and what effects does dividend policy have on this type of decision?

Expansion project-requires initial fixed asset investment : Quad Enterprises is considering a new three-year expansion project that requires an initial fixed asset investment of $2.9 million. The fixed asset will be depreciated straight-line to zero over its 3 year tax life, after which time it will be worthl..

User Account

All Pages