Q7
Funds raised from this source dilutes management's holding:
a. Retained earnings
b. Debentures
c. Equity Shares
d. Preference Shares
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2
Answer:
c
Explanation:
Equity-shareholders are the owners of the company, this means that the power of company is diluted thus, the source is equity shares.
Retained earnings are kind of the savings held by the company from its profit, which is not distributed among shareholders. Debentures and Preference shares do not dilute the management holdings, because debentures are debt issued under the company seal and preference shareholders also have no rights such as equity.
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