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SAI INTERNATIONAL SCHOOL
CLASS-XI

SUB: Business Studies
Chapter 7: Sources of Business Finance
Topic: Preference Shares

(HOME ASSIGNMENT- 31)

ASSESSMENT MCQ:

1. Preference shares are long-term source of finance.
a) True
b) False
2. Preference shareholders have a prior claim on the assets of a company in the event of the
company going into liquidation.
a) True
b) False
3. Preference and ordinary shareholders have equal voting rights at company meetings.
a) True
b) False
4. Ordinary shareholders receive variable rate of dividend.
a) True
b) False
5. Preference Shares do not have preferential right as to dividend and repayment of share capital
at the time of company's winding up.
a) True
b) False

HOME ASSIGNMENT

1 Mark Questions

1. Name the type of share which offers a fixed rate of dividend.
2. Preference shares resemble debentures. Explain
3. Why Preference shares are known as hybrid security?

3/4 Marks Questions

1. What preferential rights are enjoyed by preference shareholders? Explain.