A waterfall payment is a plan where more entitled creditors receive both interest and principal payments while lower-ranking creditors receive only interest. Here’s how it works.

Capital stock is the number of common and preferred shares that a company is authorized to issue, and is recorded in shareholders' equity.

Companies focus on their fixed costs to maximize profits at the end of the fiscal year. If a company's fixed costs are too high, the company might not create a profit for that fiscal period.