Respuesta :
Harriet recently purchased the 100 shares of ABC preferred stock, paying 4% dividend is Harriet must receive her $40-per-share dividend before common stockholders receive dividends.
What is a dividend?
A corporation may pay its shareholders a dividend when it distributes its profits to them. When a business makes money or has a surplus, it can distribute a portion of that money to its shareholders in the form of dividends. Any unused funds are withdrawn and put back into the company. A corporation is typically not allowed to pay a dividend out of its capital; instead, it must use its profit from the current year as well as any retained earnings from prior years. Distribution to shareholders can take the form of cash (often a deposit into a bank account) or, if the company has a dividend reinvestment plan, the amount can be paid by the issuance of more shares or by share repurchase. A distribution of assets may occur in several circumstances.
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