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One reason is raise capital for a company without sacrificing the control of company. Issuing common stock would do this.

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Q: What are advantages of preferred stock?
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What are the specific advantages of preferred stock?

Preferred stock have preference over common stock it getting dividends. They are not guaranteed dividends but stand in line first to receive them. Also, in the event the corporations becomes insolvent, after all debts are paid preferred stock holder stand in line in front of common stock holders to get repaid. There are disadvantages to preferred stock over common stock but you didn't ask that.


Which is a characteristic of the cost of preferred stock?

Preferred stock is valued as a perpetuity


Describe what a preferred stock is.?

A preferred stock is a stock where a public traded company or industry owns most of the stock. Preferred stocks have a claim on capital in the event of complete liquidation.


How would you define convertible stock?

Sometimes preferred stock is "convertible." Shareholders who own convertible preferred stock may, at a price announced when the stock is purchased, turn in their preferred stock and receive common stock in its place.


The cost of preferred stock is equal to?

the preferred stock dividend divided by market price


The owners of an have a voice in how the corporation is operated?

preferred stockIt is common stock not preferred stock


Will an increase in inflation have a larger impact on the price of a bond or preferred stock?

The preferred stock


What describes the difference between common stock and preferred stock?

Preferred stock pays out earnings at fixed, regular dividends


Which type of stocks have the lowest risk to shareholders?

There are two types of stock: preferred stock and common stock. Preferred stock has the lowest risk to shareholders.


How do you calculate the cost of preferred stock?

stock turnover rate is calculated as: =cost of good sold/average stock


What accurately describes the difference between common stock and preferred stock?

Preferred stock pays out earnings at fixed, regular dividends


What is a right associated with preferred stock?

Preferred stock is usually a dividend that is paid out before the dividends to common stockholders is paid.Usually,the holder of preferred stock has no voting rights within the company.