Q2
When there is no profit in one year or the profit of a company is not enough to pay the fixed dividend on preference shares, the arrears of dividend are to be carried forward and paid before a dividend is paid on the ordinary shares. This is called:
A.
Participating preference shares
B.
Cumulative preference shares
AnswerC.
Non-cumulative preference shares
D.
Non-Participating preference shares
Answer: Option B
Solution
Answer: Option B
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