Multiple choice

Directions: Choose the correct option for the given question:Preference shares are entitled to dividend in all cases irrespective of company’s profits.

  1. True

  2. False
Reveal answer Fill a bubble to check yourself
B Correct answer
Explanation

Preference shares are entitled to dividends only out of the company's profits. If there are no profits, the company is generally not obligated to pay dividends, unless the shares are cumulative.

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