Explain advantage and disadvantage of precerence share capital as a source of long term finance
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Preference shares are hybrid financing instruments having several benefits and disadvantages of using them as a source of capital. Benefits are in the form of an absence of a legal obligation to pay the dividend, improves borrowing capacity, saves dilution in control of existing shareholders and no charge on assets.
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Preference shares are hybrid financing instruments having several benefits and disadvantages of using them as a source of capital. Benefits are in the form of an absence of a legal obligation to pay the dividend, improves borrowing capacity, saves dilution in control of existing shareholders and no charge on assets.
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