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Sources Of Business Finance

Question

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What preferential rights are enjoyed by preference shareholders? Explain.

Solution

1. They do not carry the voting rights as are enjoyed by the equity shareholders.

2. If preference shares are cummulative and dividend is not paid in a particular year, then the dividend will be carried forward to the next year.

3. If preference shares are redeemable, they will be redeemed at the end of their term.

Some More Questions From Sources of Business Finance Chapter

Give meaning of medium-term finance.

Give meaning of short-term finance.

Define shares.

Give the types of shares.

Define preference shares.

Give meaning of equity share.

Give the meaning of debenture.

Define “Ploughing back of profits”.

Give meaning of trade credit.

Explain Bank Credit.

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