Which of the following is true? Select one: a. Firms can deduct 100% of preferred...
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Finance
Which of the following is true?
Select one:
a. Firms can deduct 100% of preferred dividend income from their taxable income.
b. Individuals who are in a lower tax bracket benefit more from owning preferred shares. As a result, wealthy individuals tend to hold the majority of preferred shares.
c. Although paying preferred dividends is optional in the short term, in the long term they must be paid or the firm will be in default.
d. Firms find it more expensive to issue preferred shares than to issue bonds.
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