Which type of preferred stock allows missed dividends to accumulate?

Cumulative preferred stock is the correct choice because it is specifically designed to ensure that if a company does not pay dividends in any given period, those dividends are not lost but rather accumulate. This means that the company is obligated to pay these missed dividends to cumulative preferred stockholders before any dividends can be paid to common stockholders or even before current dividends are paid to preferred stockholders.

In contrast, straight preferred stock does not have this feature; if dividends are missed, they do not accumulate and are effectively forfeited. Participating preferred stock offers the potential for additional dividends beyond the fixed rate when certain conditions are met, but it does not allow for the accumulation of missed dividends. Convertible preferred stock gives holders the option to convert their shares into common stock but does not pertain to the accumulation of dividends if they are missed. Therefore, cumulative preferred stock is the only type that ensures missed dividends will be paid in future periods, aligning it with the correct answer.