ANY COMPANY CAN ISSUE two types of stock common stock and preferred stock. It may elect to issue common stock alone, but it can only issue preferred stock after or simultaneously with the issuance of the first tranche of common stock.
This is because the common stockholders of the company are the basic owners of the business. An incorporated business cannot exist without an owner or owners.
If the company is successful in making profits, the common shareholder may gain as a result of the payment of dividends as well as through the increase in the common stock prices on the open market. The common shareholder can re…
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