12 Questions
Which type of preference shares allows the dividend to accumulate if it is not fully paid?
Cumulative Preference Shares
What happens to the unpaid dividend on non-cumulative preference shares?
It is lost forever if not paid in a particular year
Which type of preference shares entitle the holders to participate in surplus profits?
Participating Preference Shares
If a company does not make a profit in a particular year, what happens to the right to claim dividend on non-cumulative preference shares?
It is lost forever
What does the term 'irredeemable' mean in relation to preference shares?
The shares cannot be redeemed by the company
Which type of preference shares are always cumulative unless otherwise stated in the Articles of Association?
Cumulative Preference Shares
What is the primary characteristic of non-participating preference shares?
Entitled to a fixed rate of dividend
What distinguishes redeemable preference shares from irredeemable preference shares?
The payment on winding up of the company
What is the key characteristic of convertible preference shares?
Convertible into equity shares
What happens if a company issues redeemable preference shares?
They must be fully paid.
Under what condition are irredeemable preference shares payable?
Only on winding up of the company
What are non-convertible preference shares not able to do?
Be converted into equity shares
Learn about the various types of preference shares, including cumulative and non-cumulative, participating and nonparticipating, convertible and non-convertible, as well as redeemable and irredeemable preference shares.
Make Your Own Quizzes and Flashcards
Convert your notes into interactive study material.
Get started for free
