Asked by Emily_ nicole on May 27, 2024
Verified
Which of the following is not a characteristic of common stock ownership?
A) residual claimant
B) unlimited liability
C) voting rights
D) right to any dividend paid by the corporation.
Residual Claimant
An individual or entity entitled to a share of a company's assets only after all debts and other obligations have been met in the event of liquidation.
Unlimited Liability
A legal structure wherein the business owners are personally responsible for all the debts and liabilities of the business.
Voting Rights
The rights of shareholders to vote on company matters, typically exercised at annual meetings and proportional to the number of shares held.
- Comprehend common stock characteristics and shareholder rights.
Verified Answer
PL
Pamela LewisJun 01, 2024
Final Answer :
B
Explanation :
Common stock ownership does not have unlimited liability. Instead, it has limited liability, which means that the shareholder is only liable for the amount of their investment in the company. The other three characteristics - residual claimant, voting rights, and the right to any dividend paid by the corporation - are all typical features of common stock ownership.
Learning Objectives
- Comprehend common stock characteristics and shareholder rights.