What Are Preference Shares? Preference shares, more commonly referred to as preferred stock, are shares of a company’s stock with dividends that are paid out to shareholders before common stock dividends are issued. If the company enters bankruptcy, preferred stockholders are entitled to be paid from company assets before common stockholders. Most preference shares have
What Is Preferred Debt? Preferred debt is a financial obligation that is considered more important than–or make take priority over–other types of debt. For example, the first–or senior–mortgage would be considered preferred debt (when comparing the first and second mortgage). This form of debt obligation typically has to be paid first because it carries more
What Is Preferred Auto Coverage? Preferred auto insurance is offered to drivers considered to fall into the lowest risk profile. This takes into account the driver’s characteristics, and is offered to drivers considered the least likely to file a benefits claim. These drivers pay the lowest premiums for coverage, lower than those for drivers with
What Is a Preferred Creditor? A preferred creditor, also known as a “preferential creditor”, is an individual or organization that has priority in being paid the money it is owed if the debtor declares bankruptcy. Key Takeaways If someone declares bankruptcy, a preferred creditor is an individual or company that has priority in being paid. The types
What Is a Preferred Dividend? A preferred dividend is a dividend that is allocated to and paid on a company’s preferred shares. If a company is unable to pay all dividends, claims to preferred dividends take precedence over claims to dividends that are paid on common shares. Key Takeaways Preferred dividends refer to the cash
What Is a Preferred Provider Organization (PPO)? A preferred provider organization (PPO) is a popular health insurance plan designed for individuals and families. PPOs involve networks that are made up of contracted medical professionals and health insurance companies. Healthcare facilities and practitioners, known as preferred providers, offer services to the insurer’s plan policyholders at reduced
What Is a Preferred Stock? The term “stock” refers to ownership or equity in a firm. There are two types of equity—common stock and preferred stock. Preferred stockholders have a higher claim to dividends or asset distribution than common stockholders. The details of each preferred stock depend on the issue. Key Takeaways Preferred stock is
What Is Positive Confirmation? Positive confirmation is an auditing inquiry that requires the customer to respond, confirming the accuracy of an item. Positive confirmation requires proof of accuracy by affirming that the original information was correct or by providing the correct information if incorrect. Key Takeaways Positive confirmation is an auditing inquiry that requires the
What Is Positive Correlation? A positive correlation is a relationship between two variables that move in tandem—that is, in the same direction. A positive correlation exists when one variable decreases as the other variable decreases, or one variable increases while the other increases. Because these two different variables move in the same direction, they theoretically
What Are Possible Reserves? Possible reserves is one of three classifications set by the Society of Petroleum Engineers (SPE) for assessing the likelihood that a known accumulation of oil can be commercially extracted. Possible reserves refers to unproved reserves for which the likelihood of successful extraction is at least 10%—assuming existing equipment is used and
