Which of the Following Statements Pertaining to Preferred Shares Is

Multiple Choice

Which of the following statements pertaining to preferred shares is correct?

A) If the preferred shares are participating, only the current year's Net Income would be allocated to the preferred shares.
B) If the preferred shares are non-cumulative, only the current year's Net Income would be allocated to preferred shares, since dividends are never in arrears with non-cumulative preferred shares.
C) If the preferred shares are participating, the current year's Net Income would be allocated to the shares, only if the subsidiary is fully owned by the parent.
D) There can never be any dividends in arrears when preferred shares are participating.