Reference no: EM132743758

Problem 1: Which of the following(s) is(are) FALSE concerning common and preferred stock?

Group of answer choices

Option 1: Paid-in capital (pertaining to common or preferred stock) and retained earnings are internally generated equity.

Option 2: Preferred stockholders receive a dividend preference over common stockholders.

Option 3: Par value of common or preferred stock is an arbitrary amount that is assigned by the state when the corporate charter is issued.

Option 4: Both common and preferred stock carry the same degree of investment risk for the stockholder.