Firms issuing preferred stock can avoid the threat of bankruptcy that exists with debt financing. Unpaid preferred

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Firms issuing preferred stock can avoid the threat of bankruptcy that exists with debt financing. Unpaid preferred dividends are not debts of a corporation, and preferred shareholders cannot force a corporation into bankruptcy because of unpaid dividends.

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Corporate Finance

ISBN: 9780073105901

8th Edition

Authors: Jeffrey Jaffe, Bradford D Jordan

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