John buys a particular issue of stock that carries a stated dividend rate of 8 percent per year; that

Question

if this dividend is not paid during a particular year, it will not be paid in a subsequent year
before common stock dividends are paid; that John

can exchange the stock for common stock in
the future, at a specified exchange price; and that if the corporation wants to, it may buy the
stock back from John at $50 per share. This stock is best described as:
A) Noncumulative, redeemable, participating preferred.
B) Cumulative, convertible, participating preferred.
C) Cumulative, redeemable, participating preferred.
D) Noncumulative, convertible, redeemable preferred.

Answer 1

D