Question

Which of the following represents the legal rights normally held by the owners of a corporation’s...

Which of the following represents the legal rights normally held by the owners of a corporation’s common stock?

  • Right to vote for the board of directors.

  • Right to receive dividends before the owners of preferred stock.

  • Right to decide the list of stockholders who are eligible to receive dividends.

  • Right to receive a share in assets at the time of liquidation before any liability is settled.

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Homework Answers

Answer #1

The correct answer is

Right To Vote For the Board of Directors

Explanation

Common Stock Shareholders of the corporation has to right to vote for the election of board of directors of the corporations who will lead the corporation and its related matters. Stockholders of common stock have no right to vote for other three options mentioned in the question as preference dividend will also have preferance of dividend over them, stockholders of common stock cannot decide who will and will not receive the dividend and they dont have right to receive assets before liabilities are settled in liquidation.

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