Question : Questions : Equity Shares and Preference Shares
Statement 1: Equity shareholders have ownership rights and voting power in company decisions.
Statement 2: Equity shareholders do not receive any dividends.
Option 1: Statement 1 is true, and statement 2 is false.
Option 2: Statement 1 is false, and statement 2 is true.
Option 3: Both statements 1 and 2 are true.
Option 4: Both statements 1 and 2 are false.
Correct Answer:
Statement 1 is true, and statement 2 is false.
Solution : The correct answer is (a) Statement 1 is true, and statement 2 is false.
Statement 1 is true. Equity shareholders have ownership rights in the company, and they possess voting power in company decisions. They can participate in voting on important matters affecting the company.
Statement 2 is false. Equity shareholders are eligible to receive dividends from the company. In fact, one of the benefits of owning equity shares is the potential to receive dividends when the company distributes profits to its shareholders.
