14) xiv. The cash flows associated with common stock are more difficult to estimate than those related to bonds because stock has a residual claim against the company versus a contractual obligation for a bond. a. True b. False XV. Preferred stock is a hybrid--a sort of cross between a common stock and a bond in the sense that it pays dividends that normally increase annually like a stock but its payments are contractually guaranteed like interest on a bond. a. True b. False should ha ieraunted at the firm's weight