Everyone will rank the six benefits in their own order of preference, although most people will put income near the top of the list. In…

What is the difference between primary and fully diluted earnings per share? Primary earnings per share (EPS) is calculated by dividing a corporation’s reported net…

In what way does a proxy give significant power to a corporation’s management? A proxy is a combination absentee ballot and assignment of vote. Proxies…

Is there any advantage to having preemptive rights as a stockholder? Is there any disadvantage? There are two advantages to a corporation’s stockholders of having…

If a stockholder could literally inspect the company’s books, a company’s competitors could buy a few shares and use their new relationship as a stockholder…

When would a stockholder be willing to purchase a class of common stock that did not have full shareholders’ rights? Not all shareholders’ rights are…

Why is preferred stock often called a hybrid between bonds and common stock? Preferred stock is often considered a hybrid between bonds and common stock…

Companies issue warrants for at least three reasons: (1) as the mechanism for conveying preemptive rights to their shareholders (“stock subscription warrants”),(2) as incentive compensation…

Is there any difference in value between cumulative and non-cumulative preferred stock? Why, or why not? While the difference is minimal in financially healthy companies,…

Companies issue convertible bonds for at least four reasons:(1) to minimize the interest rate on their debt since the conversion feature forms part of the…