Preferred stock may exist because

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Reference no: EM131049557

Preferred stock may exist because:

A. losses before income taxes prevent a company from enjoying the tax advantages of debt interest while there is no tax advantage for preferred dividends.

B. an advantage exists for the firm; preferred shareholders cannot force the company into bankruptcy because of unpaid dividends.

C. corporations get a 70% tax exemption on preferred dividends received.

D. All of these. None of these.

Reference no: EM131049557

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