The security that represents the residual ownership of a firm and has no priority in bankruptcy is called Common stock.
What is common stock?
- A form of corporate equity ownership and a kind of security is common stock. Outside of the United States, the words voting share and ordinary share are widely used.
- In the UK and other Commonwealth nations, common stock are referred to as equity shares or ordinary shares.
- This kind of share entitles the bearer to a portion of the company's income as well as voting rights regarding corporate policy and the make-up of the board of directors.
- Any specific corporate assets do not belong to common stockholders; instead, they are owned equally by all shareholders.
- In the event that a corporation issues both ordinary and preference shares, the preference owners will be paid dividends first.
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