Explain each of the following preferred stock dividend preferences: (l) Current dividend preference, (2) Cumulative dividend preference,

Question:

Explain each of the following preferred stock preferences:
(l) Current preference,
(2) Cumulative preference,
(3) Participating preference.

Dividend
A dividend is a distribution of a portion of company’s earnings, decided and managed by the company’s board of directors, and paid to the shareholders. Dividends are given on the shares. It is a token reward paid to the shareholders for their...