Which statement is true? a) from a legal perspective, preferred stock is a form of corporate equityb) all classes of stock must have equal voting rights per sharec) common shareholders elect the corporate directors while the preferred shareholders vote on mergers and acquisitionsd) preferred dividends provide tax-free income to individual investorse) preferred shareholders prefer noncumulative dividends over cumulative dividends

The following pertains to smoke, inc.’s investment in debt securities: on december 31, year 3, smoke reclassified a security acquired during the year for $70,000. it had a $50,000 fair value when it was reclassified from trading to available-for-sale. an available-for-sale security costing $75,000, written down to $30,000 in year 2 because of an other-than-temporary impairment of fair value, had a $60,000 fair value on december 31, year 3. what is the net effect of the above items on smoke’s net income for the year ended december 31, year 3?