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Outline the similarities between Ordinary and Preference Shares Capital

Outline the similarities between Ordinary and Preference Shares Capital.

Answers

sharon
i)They are a permanent source of finance especially the irredeemable preference shares
ii)Both receive perpetual dividends ( irredeemable preference shares)
iii)Both form the company share capital
iv)Both are difficult to raise due to prolonged formalities.
v)Both claim on assets residual and in profits after debt finance has had it’s claim.
vi)Payment of dividends not a legal obligation
vii)Both finances are not secured
viii)Both are long –term finance to the company.
sharon kalunda answered the question on April 16, 2019 at 13:37

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