Which of the following is not a feature of preference shares?
Payment of dividend on preference shares is compulsory
The preferential shareholders have preferential claim over dividend and repayment of capital
Preference shares are known as hybrid securities
Preference shares do not create a charge on the assets of the company
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Explanation:
No it is not compulsory to pay any dividend to Preference shareholders in case, there is Profit but company does not want to pay any dividend. ... Equity shareholders are owners of the Company. They are the one who has entitled “Preference Shareholders as such”. Such shareholders therefore enjoys such Priority.
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