Debtholders have precedence over preferred stockholders. And preferred stockholders have preference over common stockholders. True False

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Debtholders have precedence over preferred stockholders. And preferred stockholders have preference over common stockholders. True False

business accounting

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Answer 1

Answer #1

Answer : True

Explanation:

Upon liquidation of the entity, the payments are made in the following order -

1. Debtholders/ creditors

2. Preffered stock holders

3. Common stock holder

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Answer 2

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Debtholders have precedence over preferred stockholders. And preferred stockholders have preference over common stockholders. True False

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