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These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are called
- a)Participating preference shares
- b)Convertible preference shares
- c)Redeemable preference shares
- d)Cumulative preference shares
Correct answer is option 'A'. Can you explain this answer?
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These shares which in addition to the fixed preference dividend, carry...
Participating preference shares:
Participating preference shares are a type of preference shares issued by companies that carry a right to participate in the surplus profits, if any, after a fixed preference dividend has been paid to the equity shareholders.
Features of participating preference shares:
1. Fixed preference dividend: Participating preference shares carry a fixed preference dividend that is paid to the shareholders on a regular basis.
2. Right to participate in surplus profits: In addition to the fixed preference dividend, participating preference shareholders have the right to participate in the surplus profits, if any, after a stipulated dividend has been paid to the equity shareholders.
3. Higher risk and return: Participating preference shares are considered to be a higher risk and higher return investment compared to other types of preference shares, as they carry the potential for higher returns if the company performs well.
4. Non-voting shares: Participating preference shares are generally non-voting shares, which means that the shareholders do not have any voting rights in the company.
Advantages of participating preference shares:
1. Higher returns: Participating preference shares offer the potential for higher returns compared to other types of preference shares.
2. Fixed dividend: Participating preference shareholders are entitled to a fixed dividend, which provides them with a regular income.
3. Participating in surplus profits: Participating preference shareholders have the right to participate in the surplus profits of the company, which can lead to higher returns if the company performs well.
Disadvantages of participating preference shares:
1. Higher risk: Participating preference shares are considered to be a higher risk investment compared to other types of preference shares.
2. Non-voting shares: Participating preference shareholders do not have any voting rights in the company, which means that they have little control over the management of the company.
3. Limited liquidity: Participating preference shares may have limited liquidity, which means that it may be difficult to sell them in the market.
Participating preference shares are a type of preference shares issued by companies that carry a right to participate in the surplus profits, if any, after a fixed preference dividend has been paid to the equity shareholders.
Features of participating preference shares:
1. Fixed preference dividend: Participating preference shares carry a fixed preference dividend that is paid to the shareholders on a regular basis.
2. Right to participate in surplus profits: In addition to the fixed preference dividend, participating preference shareholders have the right to participate in the surplus profits, if any, after a stipulated dividend has been paid to the equity shareholders.
3. Higher risk and return: Participating preference shares are considered to be a higher risk and higher return investment compared to other types of preference shares, as they carry the potential for higher returns if the company performs well.
4. Non-voting shares: Participating preference shares are generally non-voting shares, which means that the shareholders do not have any voting rights in the company.
Advantages of participating preference shares:
1. Higher returns: Participating preference shares offer the potential for higher returns compared to other types of preference shares.
2. Fixed dividend: Participating preference shareholders are entitled to a fixed dividend, which provides them with a regular income.
3. Participating in surplus profits: Participating preference shareholders have the right to participate in the surplus profits of the company, which can lead to higher returns if the company performs well.
Disadvantages of participating preference shares:
1. Higher risk: Participating preference shares are considered to be a higher risk investment compared to other types of preference shares.
2. Non-voting shares: Participating preference shareholders do not have any voting rights in the company, which means that they have little control over the management of the company.
3. Limited liquidity: Participating preference shares may have limited liquidity, which means that it may be difficult to sell them in the market.
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These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer?
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These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer?.
These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer? for Commerce 2024 is part of Commerce preparation. The Question and answers have been prepared according to the Commerce exam syllabus. Information about These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer? covers all topics & solutions for Commerce 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer?.
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These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer?, a detailed solution for These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer? has been provided alongside types of These shares which in addition to the fixed preference dividend, carry a right to participate in the surplus profits, if any, after dividend at a stipulated rate has been paid to the equity shareholders are calleda)Participating preference sharesb)Convertible preference sharesc)Redeemable preference sharesd)Cumulative preference sharesCorrect answer is option 'A'. Can you explain this answer? theory, EduRev gives you an
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