difference between Equity Capital and Preference capital?
Answer Posted / prasad shinde
First At all share capital is the liability of the company.
Equity shareholders are the owners of the company. only they
have voting right in annual general meeting.
preference shareholders have first preference to get
dividend when company earns the profit. then, debentures
holders get dividend and at last Equity shareholders.
preference shareholders have right convert their share in to
equity shares after some period.
equity share capital is permanent capital of the
company. at the time of winding up of the company preference
shareholders get their capital return 1st, then debenture
holders and at last equity shareholders.
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