Priority of Distribution

Question 1

Preferred stock vs. common stock?

Answer 1

PREFERRED is paid out FIRST

Then remaining common shares paid out

Question 2

Participating preferred shares

Answer 2

Participating shares collect as preferred AND THEN participate with common shares

So first, calculate preferred share payout, then re-calculate common share payout

Question 3

Cumulative preferred shares

Answer 3

Cumulative preferred shares receive payout ANNUALLY

Question 4

Does number of shareholders impact payouts?

Answer 4

NO, calculated by dividends regardless