Which of the Following Is NOT a Characteristic of Preferred

Multiple Choice

Which of the following is NOT a characteristic of preferred stock as an investment?

A) Preferred stockholders are entitled to receive their dividend prior to payment of dividends to common stockholders
B) Preferred stock dividends are taxed at the capital gains rate for individual investors
C) Preferred stock dividends may be omitted by the corporation under certain circumstances
D) It is a hybrid security of common stock and debt