what is cumulative preference share

Posted on 02-04-2016        By ADMIN

cumulative preference share

1.   Cumulative Preference Shares: The holders of cumulative preference share

 are  entitled to receive a fixed percentage of dividend before anything isgiven,

 tot other classes of shareholders. 

Apart from this right, in the case ofthese shares, if the 

company has no profits or inadequate profits in any yearto declare dividend, the 

arrears of dividend would accumulate and becomepayable out of the 

future profits before anything is given to other classes ofshareholders.

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