Business Finance
Saudi Electronic University Common & Preferred Stock Responses

Saudi electronic university

Question Description

I’m working on a Accounting exercise and need support.

attached file contain two articles i need :

- a discussion reply on each article for no more than 8 rows per reply

- the reply is in APA style with one reference

so, the total is two replies.

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Ziyad Alarfaj Ziyad: Module 10 COLLAPSE Common Stock Common stock represents ownership in a company, and each share of common stock holds an equal amount of that ownership. Common stock grants the stockholders certain rights, which typically include the right to sell the stock in the secondary market, either through a public exchange or in a private transaction. When you raise money for your company by issuing common stock, you don't incur any debt. You have no obligation to pay dividends, so your board of directors can decide to plow all of your company's profits back into growing the company (Parker, 2016). Preferred Stock Preferred stock has characteristics of both common stock and a bond; it is sometimes referred to as a hybrid security. Like common stock, preferred stock gives the shareholder an ownership position in the company; like bonds, preferred stock usually doesn't have voting rights. Preferred stock is typically issued with a fixed dividend; this is similar to a bond's interest rate, but like common stock, preferred stock dividends are not guaranteed. The board of directors can vote to suspend preferred dividend payments, but all preferred dividends, including any missed dividend payments, must be paid before the company can pay any dividends on its common stock. Preferred stock typically includes a call provision, which allows your company to repurchase the stock on demand for a fixed price (Parker, 2016). In conclusion, we notice that common stock and preferred stock have advantages. While deciding which form can be ideal for you, it is important to determine your financial situation, timeline and investment objectives. References: Parker, M. (2016, October 26). Common Stock Vs Preferred Stock. Retrieved from https://smallbusiness.chron.com/common-stock-vs-preferred-stock-57044.htmlCommon Stock vs. Preferred Stock. (n.d.). Retrieved from https://www.ntbinc.com/Common-Stock-vs--Preferred-Stock.c1019.htm Reply: Ibrahim Almudayfir Kinds of Equity COLLAPSE In firms there are two stock that issuing some kinds of equity which are preferred stock and common stock. According to Ganti and Scott (2020), preferred stockholders have a higher claim to dividends or asset distribution than common stockholders. The details of each preferred stock depend on the issue. The authors added that, preferred shareholders have priority over common stockholders when it comes to dividends. On the other hand, common stocks are shares of ownership of a corporation. They allow you to own a portion of the company without taking possession (Amadeo, 2020). The main difference between preferred stock and common stock that preferred stock gives no voting rights to stakeholders while common stock does. The firm issuing the preferred stock and the common stock because common stocks are more expensive to issue than preferred stock, common stock have not gotten a fixed rate dividends like preferred stocks, and by giving the preferred stocks the firm maintains a strategic distance from the weakening of the organization equity. Also, the preferred stocks under almost any set of terms, assuming they don't fall foul of laws or regulations, also, most of preferred issues have no maturity dates or very distant ones. References Amadeo, K. (2020). What Is Common Stock? Retrieved from https://www.thebalance.com/common-stocks-3305892 Ganti, A. & Scott, G. (2020). Preferred Stock. Retrieved from https://www.investopedia.com/terms/p/preferredstock.asp Reply: ...
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Final Answer

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Response One
From my experience, businesses will raise money through the sale of stock. There are
two types of stocks that are considered, namely the preferred and common stock. In my view, for
a person who is looking to invest in stocks, both options can be a worthwhile investment, and
they are available in the stock e...

Kishnewt2017 (32459)
Carnegie Mellon University

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