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exam question

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA LW Exams › exam question

  • This topic has 1 reply, 2 voices, and was last updated 6 years ago by MikeLittle.
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  • April 8, 2019 at 12:57 pm #511455
    reem1589
    Participant
    • Topics: 61
    • Replies: 17
    • ☆☆

    could you please explain why the answer is A.
    There are a number of ways in which investors can take an interest in a company and such different interests have different rights attached to them.
    Which of the following NORMALLY participate in surplus capital?

    A. ordinary shares
    B. preference shares
    C. debentures secured by a fixed charge
    D. debentures secured by a floating charge

    April 8, 2019 at 8:43 pm #511485
    MikeLittle
    Keymaster
    • Topics: 27
    • Replies: 23345
    • ☆☆☆☆☆

    Because preference shares normally carry the right only to the repayment of capital and both types of debenture are creditors of the company and not shareholders

    OK?

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