Financial management

Question

All of the followings are the rights and privileges of a Common Stockholders EXCEPTING:

a.	Voting/Proxy Rights
b.	Right to Dividends
c.	Residual Right
d.	Pre-emptive Right
e.	Right to Interest Payments

Answer 1

Hey Junito,

There are several articles online that explain the typical rights of common stockholders which you may want to check out for further learning.

But to simply answer your question, common stockholders are not entitled to (E) interest payments. Generally speaking, stockholders are buying into the assets of a company and receive dividend payments in return. Debt holders are lending money to a company and receive interest payments in return.

Answer 2

Hello Junito,

E is the answer. Common stockholders get dividend payments and not interest payment.

good luck.

John