1
WGU C214 Financial Management Pass
the OA 2025/2026 Exam Questions and
Answers | 100% Solved
Characteristics of preferred stock includes - 🧠 ANSWER ✔✔-dividends in arrears
-dividends are cumulative
-higher payoff claim in a BK (has first dibs in a BK)
-considered "hybrid" (part stock/part bond)
-no fixed maturity date
-no voting rights
-can skip dividend payments
-dividends don't change year-after-year
-used in start ups (IPO)
Preferred stock dividends - 🧠 ANSWER ✔✔can go without payment and pay in
arrears the following year
Characteristics of common stock are - 🧠 ANSWER ✔✔-voting rights
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
1
STATEMENT. ALL RIGHTS RESERVED
,2
-no maturity date
-corporate governance
-lower payoff claim in BK
-variable returns
-unlimited earnings potential
-earnings are in dividends & the increase in price of stock
New start up ventures often issue - 🧠 ANSWER ✔✔preferred stock (in an IPO)
What stock is considered a hybrid - 🧠 ANSWER ✔✔preferred stock
One thing common stock and preferred stock have in common is - 🧠 ANSWER
✔✔both have no maturity date
Which type of security has voting rights - 🧠 ANSWER ✔✔common stock
Debt covenants and restrictions help to ensure that - 🧠 ANSWER ✔✔management
is meeting bond and shareholder expectations
NOTE: covenants are promises meant to be kept
What is true regarding bonds - 🧠 ANSWER ✔✔-when bond matures, bondholder
gets lump sum back
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
2
STATEMENT. ALL RIGHTS RESERVED
, 3
-coupon rate doesn't change
-maturity is in years
-PAR value is typically $1000
-Future value (same as PAR) is typically $1000
Bond sells at face value when - 🧠 ANSWER ✔✔required rate of return is equal to
the coupon rate
Why are bonds the primary method for raising capital - 🧠 ANSWER ✔✔because
bonds remove the intermediary costs
NOTE: IPO's require an intermediary known as a syndicate - a group of banks
underwriting the security issue
What type of bond can be traded for stock - 🧠 ANSWER ✔✔convertible bonds
What is the interest rate for annual payments of a bond known as - 🧠 ANSWER
✔✔the coupon rate
NOTE: coupon rate is the established interest rate for the life of the bond and will
remain unchanged
Coupon rate is the established rate of the bond and should - 🧠 ANSWER ✔✔never
change
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
3
STATEMENT. ALL RIGHTS RESERVED
WGU C214 Financial Management Pass
the OA 2025/2026 Exam Questions and
Answers | 100% Solved
Characteristics of preferred stock includes - 🧠 ANSWER ✔✔-dividends in arrears
-dividends are cumulative
-higher payoff claim in a BK (has first dibs in a BK)
-considered "hybrid" (part stock/part bond)
-no fixed maturity date
-no voting rights
-can skip dividend payments
-dividends don't change year-after-year
-used in start ups (IPO)
Preferred stock dividends - 🧠 ANSWER ✔✔can go without payment and pay in
arrears the following year
Characteristics of common stock are - 🧠 ANSWER ✔✔-voting rights
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
1
STATEMENT. ALL RIGHTS RESERVED
,2
-no maturity date
-corporate governance
-lower payoff claim in BK
-variable returns
-unlimited earnings potential
-earnings are in dividends & the increase in price of stock
New start up ventures often issue - 🧠 ANSWER ✔✔preferred stock (in an IPO)
What stock is considered a hybrid - 🧠 ANSWER ✔✔preferred stock
One thing common stock and preferred stock have in common is - 🧠 ANSWER
✔✔both have no maturity date
Which type of security has voting rights - 🧠 ANSWER ✔✔common stock
Debt covenants and restrictions help to ensure that - 🧠 ANSWER ✔✔management
is meeting bond and shareholder expectations
NOTE: covenants are promises meant to be kept
What is true regarding bonds - 🧠 ANSWER ✔✔-when bond matures, bondholder
gets lump sum back
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
2
STATEMENT. ALL RIGHTS RESERVED
, 3
-coupon rate doesn't change
-maturity is in years
-PAR value is typically $1000
-Future value (same as PAR) is typically $1000
Bond sells at face value when - 🧠 ANSWER ✔✔required rate of return is equal to
the coupon rate
Why are bonds the primary method for raising capital - 🧠 ANSWER ✔✔because
bonds remove the intermediary costs
NOTE: IPO's require an intermediary known as a syndicate - a group of banks
underwriting the security issue
What type of bond can be traded for stock - 🧠 ANSWER ✔✔convertible bonds
What is the interest rate for annual payments of a bond known as - 🧠 ANSWER
✔✔the coupon rate
NOTE: coupon rate is the established interest rate for the life of the bond and will
remain unchanged
Coupon rate is the established rate of the bond and should - 🧠 ANSWER ✔✔never
change
COPYRIGHT©NINJANERD 2025/2026. YEAR PUBLISHED 2025. COMPANY REGISTRATION NUMBER: 619652435. TERMS OF USE. PRIVACY
3
STATEMENT. ALL RIGHTS RESERVED
