Question

Which most accurately describes the difference between common stock and preferred stock?

Answer 1

Common stock is a corporate owned equity. Common stock shareholders have a right to the company's assets after all bondholders, preferred stock/shareholders and other debt holders are paid first and in full. Preferred stock has the owner entity to a fixed amount of money. Those that are preferred shareholders/stockholders receive money before any common stock holders do. They have a higher claim on assets and company earnings. 

Answer 2

Common stock and preferred stock are the two main types of stocks. Common stocks are issued to public to generate a stream of funding to expand the business. The common stocks are also referred to only as stocks.

Preferred stock on the other hand is a share of ownership in a public company.

The following most accurately describes the difference between common stock and preferred stock: Preferred stock pays out earnings at fixed, regular dividends