Question

Question 14 (1 point) Preferred stocks typically: O A) possess voting rights. O B) participate in earnings. O C) receive regular interest payments. O D) are used to avoid "double-taxation.". one of these. Question 15 (1 point) The statement of stockholders' equity includes information about: OA) Beginning equity account balances. ccount balances. OC) Dividends. OD) All of the above. O E) None of these.

Answer 1

Question 14)

Answer:- E) None of these

Explanation:

A) Preferred stockholders do not have any voting rights.

B) Preferred Stock does not participate in earnings. Preferred dividends are paid out of the net income after tax and before deciding any dividend to common stockholders.

C) The preferred stockholders gets regular dividends and not interest.

D) Preferred stock are not used to avoid double taxation. Like the common stockholders, the preferred stockholders are also liable to dividend tax on their dividend income. However preferred stock dividend are taxed at a lower rate than the normal income (other than the investors who belong to higher tax bracket).

  

Question-15: Answer: D. All of the above. Explanation's 1. The statement of shareholders' equity includes information about Beginning equity, account balances, Ending equity account balances and dividends. statement of Shareholders' equity Amount XXX XX xx Beginning equity account balance Abbir Net earnings Addin other comprehensive income Less Dividends Less". Tresury stock purchases : Ending Equity account balance x (+) XXXX

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