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Which of the following statements is correct? None of these statements is correct If there is...

Which of the following statements is correct? None of these statements is correct If there is only one class of stock, the stock is called preferred stock. Market value is the figure selected by the organizers of the corporation to be assigned to each share of stock for accounting purposes. In the event of liquidation, preferred stockholders have a claim on assets before that of common stockholders

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Answer: In the event of liquidation, preferred stockholders have a claim on assets before that of common stockholders.

If there is only one class of stock, the stock is called common stock and not preferred stock.

The value assigned to each share of stock for accounting purposes is the par value of stock and not the market value.

The preferred stockholders are given a preference over the common stockholders to redeem their shares and claim the assets. Hence, this is the correct statement.

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