Which of the following is true? 1-If a company files for bankruptcy, preferred shareholders' claims are...
Which of the following is true?
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1-If a company files for bankruptcy, preferred shareholders' claims are paid prior to creditors' claims. |
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2-If a company files for bankruptcy, preferred shareholders' claims are paid prior to common shareholders' claims. |
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3-In the event of bankruptcy and subsequent liquidation, preferred shareholders only receive funds after creditors and common shareholders. |
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4-If a company files for bankruptcy, preferred shareholders' claims are paid prior to managers' claims. which one is correct answer |
Homework Answers
If a company files for bankruptcy, preferred shareholders' claims are paid prior to common shareholders' claims.
Explanation:
If a company files for bankruptcy,
After meeting all expenses, Debt holders are paid first, after that preferred stock holders are paid and in the last common stockholders are paid.
Add Answer to:
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