हिंदी

Preference Shareholders Do Not Enjoy Normal Voting Rights. - Secretarial Practice

प्रश्न

State, with reason, whether the following statement is True or False.

Preference shareholders do not enjoy normal voting rights.

उत्तर

This statement is True.

Reasons: Meaning: Preference shares get priority over equity shares in two respects.

(A) Priority to get dividend. (B) Priority to get capital at winding.

(1) Holders of preference shares do not have normal voting rights like equity shares. However, they can vote on any such matter which is directly affects their interest as investors.

(2) It is ownership capital but less riskier due to guaranteed returns and payment of capital.

(3) It is temporary by nature, generally returned after a period of time. It is therefore safe capital.

(4) Preference shares earn a fixed rate of dividend.

(5) They have no participation in management or fight to attend meetings.

(6) They may vote by attending meetings especially called for them on a matter involving their interests if the need arises.

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Types of Shares - Preference Shares Equity Shares

क्या इस प्रश्न या उत्तर में कोई त्रुटि है?

Q 4.1 Q 3.5 Q 4.2

2016-2017 (March)

APPEARS IN

2016-2017 (March) (with solutions)

Q 4.1 | 5 marks

2013-2014 (October) (with solutions)

Q 4.D | 5 marks

संबंधित प्रश्न

The type of shareholders who can participate in the management of the company.

Equity Shares and Preference Shares.

Write notes on Features of equity shares.

Select the proper option from the option given below and rewrite the sentences:

If a share of 100 is issued at 110. It is said to be issued at ___________.

Fully convertible debentures are converted into __________ shares on maturity.

Long Answer Question

What do you mean by the term ‘share’? Discuss the type of shares, which can be issued under the Companies Act, 2013 as amended to date.

Long Answer Question

What is a ‘Preference Share’? Describe the different types of preference shares.

Software solution India Ltd inviting application for 20,000 equity share of Rs 100 each, payable Rs 40 on application, Rs 30 on allotment and Rs 30 on call. The company received applications for 32,000 shares. Application for 2,000 shares were rejected and money returned to Applicants. Applications for 10,000 shares were accepted in full and applicants for 20,000 share allotted half of the number of share applied and excess application money adjusted into allotment. All money received due on allotment and call. Prepare journal and cash book.

A limited company offered for subscription of 1,00,000 equity shares of Rs 10 each at a premium of Rs 2 per share. 2,00,000. 10% Preference shares of Rs 10 each at par. The amount on share was payable as under :

	Equity Shares	Preference Shares
On Application	Rs 3 per share	Rs 3 per share
On Allotment	Rs 5 per share	Rs 4 per share
	(including a premium)
On First Call	Rs 4 per share	Rs 3 per share

All the shares were fully subscribed, called-up and paid. Record these transactions in the journal and cash book of the company:

Sangam Ltd. invited applications for 10,000 Equity Shares of ₹ 100 each issued at par. The amount was payable on application. The issue was oversubscribed by 2,000 shares and allotment was made on pro rata basis. Pass necessary Journal entries.

Sandesh Ltd. took over the assets of ₹ 7,00,000 and liabilities of ₹ 2,00,000 from Sanchar Ltd. for a purchase consideration of ₹ 4,59,500. ₹ 8,500 were paid by accepting a draft in favour of Sanchar Ltd. payable after three months and the balance was paid by issue of equity shares of ₹ 10 each at a premium of 10% in favour of Sanchar Ltd.
Pass necessary journal entries for the above transactions in the books of Sandesh Ltd.

Explain the features of preference shares.

Explain any three disadvantages of issuing equity shares, from the Company's point of view.

Distinguish between equity shares and preference shares.

Write any four features of equity shares.

Which of the following statement is incorrect about Preference Shares?

Which type of shares is not convertible?

Which is not true about Preference Shares?

On the basis of information given by Aradhana Ltd., prepare a Cash Flow Statement for the year ending 31st March 2021:

Aradhana Ltd. Balance Sheet as on 31st March, 2021
Particulars	Note No.	31st March, 2020	31st March, 2021
I. Equity and Liabilities
1. Shareholder’s Funds
(a) Share Capital		5,00,000	7,30,000
(b) Reserves and Surplus	1	3,50,000	3,70,000
2. Non-current Liabilities
Long-term Borrowings	2	4,00,000	2,00,000
3. Current Liabilities
(a) Trade Payables	3	3,60,000	4,60,000
(b) Short Term provisions	4	3,25,000	3,20,000
Total		19,35,000	20,80,000
II. Assets
1. Non-current Assets
(a)Fixed Assets	5
(i) Tangible Assets	6	4,50,000	5,00,000
(ii) Intangible Assets		3,10,000	3,02,000
(b)Long-term Loans and Advances		4,00,000	4,30,000
2. Current Assets
(a) Inventories		2,70,000	2,90,000
(b) Trade Receivables		2,40,000	2,60,000
(c) Cash and Cash Equivalents		2,65,000	2,98,000
Total		19,35,000	20,80,000

Note to Accounts

Particulars	31st March 2020	31st March 2021
1. Reserves and Surplus Statement of Profit and loss	3,50,000	3,70,000
2. Long-term Borrowings 10% Debentures	4,00,000	2,00,000
3. Trade Payables
Creditors	2,40,000	2,60,000
Bills Payable	1,20,000	2,00,000
	3,60,000	4,60,000
4. Short-Term Provisions Provision for Tax	3,25,000	3,20,000
5. Tangible Fixed Assets
Machinery	5,50,000	6,60,000
Less: Provision for Depreciation	1,00,000	1,60,000
	4,50,000	5,00,000
6. Intangible Fixed Assets Patents	3,10,000	3,02,000