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What preferential rights are enjoyed by preference shareholders? Explain. - Business Studies

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प्रश्न

What preferential rights are enjoyed by preference shareholders? Explain.

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उत्तर

Preference shares are shares that provide the shareholders preferential rights regarding the repayment of capital and payment of dividends after a certain specified period of time. Preference shares are issued by a company to raise capital, and the repayment to preference shareholders is made in accordance with the terms specified in Section 80 of the Companies Act, 1956. Preference shareholders are entitled to the following preferential rights.

(a) Preference shares entitle their holders the right to receive dividends of a fixed amount or at a fixed rate.

(b) Preference shares entitle their holders the preferential right to receive repayment of capital invested by them before their equity counterparts at the time of winding up of the company.

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अध्याय 8: Sources of Business Finance - Short Answers [पृष्ठ २०५]

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एनसीईआरटी Business Studies [English] Class 11
अध्याय 8 Sources of Business Finance
Short Answers | Q 4 | पृष्ठ २०५

संबंधित प्रश्न

Multiple Choice Question:

The term 'redeemable' is used for


Match the pairs.

Group 'A'

Group 'B'

a) Death of member

1. Forfeiture of shares

b) Voluntary return of shares to company by member

2. Book Building Method

c) Price of shares mentioned in prospectus

3. Offered to existing employees

d) ESPS

4. Surrender of shares

e) Regret Letter

5. Transmission of shares

 

6. Non-allotment of shares

 

7. Offered to existing Equity shareholders

 

8. Transfer of shares

 

9. Fixed price issue method

 

10. Allotment of shares


Match the pairs.

Group 'A'

Group 'B'

a) Issued capital

1) Non-payment of calls

b) FPO

2) Any issue after IPO

c) Bonus shares

3) Offered to existing employees

d) Issued within two months of allotment of shares

4) Capital offered to public to subscribe

e) Forfeiture of shares

5) Share certificate

 

6) First time issue of shares

 

7) Free shares issued to existing equity shareholders

 

8) Maximum capital a company can raise

 

9) Allotment Letter

 

10) Operation of law


Write a word or a term or a phrase which can substitute the following statement.

Capital collected by way of issue of Equity and Preference shares.


Find the odd one.


Find the odd one.


Select the correct option from the bracket.

(First time offer of shares, Shares offered to public, Shares offered to existing Equity shareholders, Shares offered to existing employees, Transmission of shares)

Group 'A'

Group "B"

a) Public offer of shares

1) ____________

b) ____________

2) Initial Public offer

c) Rights Issue

3) ____________

d) ____________

4) ESOS

e) Operation of law

5) ____________


Answer in one sentence.

With whom should the prospectus be filed before issuing it to the public?


Explain the following term/concept.

Bonus shares


Justify the following statement.

Company has to fulfill certain provisions while making Right Issue.


Justify the following statement.

To Issue Bonus Shares, a company has to fulfill certain provisions.


Justify the following statement.

ESOS is offered by a company to its permanent employees, Directors and Officers


Match the pairs.

Group A Group B
a) Debenture holders 1) Secured deposits
b) IPO  2) Owners
c) Charge on assets 3) Any issue after first-time public offer
d) SEBI  4) To protect the interest of investors in securities market
e) Issued within two months of allotment of shares 5) First-time public offer
  6) Allotment letter
  7) To protect the interest of companies in securities market
  8) Share certificate
  9) Creditors
  10) Unsecured deposits

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