Differences between debt and preference share capital, Finance Basics

Assignment Help:

Differences between Debt and Preference Share Capital

Differences between Debt and Preference Share Capital are given below:

 

DEBT

 

PREFERENCE SHARE CAPITAL

a)

b)

c)

d)

e)

 

Interest is tax allowable

Interest is a legal obligation

Debt finance is always secured

Debt finance is a pre-conditional

Has a superior claim

a)

b)

c)

d)

e)

 

Dividends are not tax allowable

Dividends are not a legal obligation

Preference is not secured finance

Is not conditional finance

Has a residue claim (after debt)

 


Related Discussions:- Differences between debt and preference share capital

Calculate average price-earnings ratio, Regan Inc., was founded nine years ...

Regan Inc., was founded nine years ago by brother and sister Carrington and Genevieve Regan. The company manufactures and installs commercial heating, ventilation, and cooling (HVA

Selection of remuneration policy, Selection of Remuneration Policy Th...

Selection of Remuneration Policy The alternative of a suitable remuneration policy through a company will depend, with another thing, on: 1. Cost: the extent to that the p

Working capital, Working Capital a) Working capital or called gross wo...

Working Capital a) Working capital or called gross working capital also, refers as current assets. b) Net working capital refers to current assets minus current liabilities

What are the functions of stock exchange, What are the Functions of Stock E...

What are the Functions of Stock Exchange Main functions performed b stock exchange are as follows: (1) Providing Liquidity and Marketability to existing securities: Sto

Illustrate role of credit unions in depository institutions, Illustrate the...

Illustrate the role of credit unions in depository institutions. Credit unions: Credit unions are non-profit institutions equally organised and owned through their member

Meaning of a sentence, on this sentence: "all have an interest in understan...

on this sentence: "all have an interest in understanding what drives trade" please explain what''s meaning of "what drives trade"?

Illustrate in brief about the investment process, Illustrate in brief abou...

Illustrate in brief about the Investment  Process A  typical  investment  decision  undergoes  a  five  step  procedure which, in turn, forms the foundation of investment pr

What are the types of orders, What are the Types of orders (i) Spot ...

What are the Types of orders (i) Spot Delivery: Spot delivery means delivery and payment on the same day as date of the contract or on the next day. (ii) Hand Delivery:

Financial Institution Regulations, Why are financial institutions heavily r...

Why are financial institutions heavily regulated, with specific focus on their ability to increase or reduce the money supply?

Define the direct finance and indirect finance in markets, Define the direc...

Define the direct finance and indirect finance in markets. In direct finance, borrower-spenders borrow funds directly by lenders into the financial markets through selling them

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd