SIE Exam Practice Question 411

Question: 411

An NYSE listed corporation has outstanding preferred stock with a cumulative provision and a $5.00 annual dividend. If the earnings over the past two years have led to the Board of Directors declaring a $3.00 preferred dividend two years ago and a $2.00 dividend last year, in order that a common dividend may be paid for the current year:

A. Dividends in arrears of $5.00 must be paid to the preferred

B. Preferred stockholders must be paid $10 per share

C. Preferred stockholders need to be paid their current $ 5.00 dividend

D. None of the above is accurate.

SIE Exam Practice Question 411

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