Question

Soft Lumber has bonds, preferred stock and common stock as its capital components. _____________ is the right most apt to be granted to its preferred shareholders.

Answer 1

Answer: right to share in company profits prior to other shareholders

Step-by-step explanation:

The preferred shareholders are paid their dividends before dividends are paid to other common shareholders. The preferred stock also gives no voting rights to the shareholders.

Preferred shareholders are known to have priority over the income of a company right to share in company profits prior to other shareholders.