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Question

Which of the following feature(s) of preference shares are similar to those of equity shares?


A
Redeemability
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B
No obligation to pay dividend
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C
Voting rights
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D
Change over assets
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E
Both (B) and (C) above
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Solution

The correct option is B No obligation to pay dividend
Like in the case of equity shareholders there is no obligatory payment to the preference shareholders and the preference dividend is not tax deductible.
Hence, option (B) is the correct answer.

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