Question : Which shareholder has the right to receive the arrears of dividend from future profit?
Option 1: Redeemable preference shares
Option 2: Non – redeemable preference shares
Option 3: Cumulative preference shares
Option 4: Non- cumulative preference shares
Correct Answer: Cumulative preference shares
Solution : Answer = Cumulative preference shares
Cumulative preference shares are the shares that carry the right to receive arrears of dividends. It means that whenever a company decides to pay any dividend. It will have to pay arrears of dividends to cumulative preference shareholders.
Question : Which type of preference share does not carry the right to receive the arrears of dividends from future profits?
Question : Which shareholder returns their capital after some specified time?
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