what is Non Cumulative preference shares

Posted on 02-04-2016        By ADMIN

Non Cumulative preference shares

1.   Non-Cumulative Preference Shares: Non-Cumulative preference shares are

 entitled to a fixed rate of dividend in the first instance (i,e., beforeanything is

 given to other types of shareholders). But they are entitled to receivethe fixed 

percentage of dividend in the first instance only for the year oryears when the

 company earns sufficient profits and dividend is declared. Incase the company 

has no or inadequate profits in any year to declare dividend,then, the arrears

 of dividend do not accumulate and become payable out offuture profits in the case of these shares.

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