A preference share with a feature allowing preference shareholders to share with ordinary shareholders in any dividends in excess of the percent or dollar amount stated on the preference shares are called:
A) Cumulative preference share.
B) Callable preference share.
C) Participating preference share.
D) Convertible preference share.
E) Preferential preference share.

Question

Quizplus · Accepted Answer

Participating preference shares have the feature of sharing any dividends in excess of the stated percentage or dollar amount with ordinary shareholders. Cumulative preference shares accumulate unpaid dividends, callable preference shares can be redeemed by the issuer, convertible preference shares can be converted into ordinary shares, and preferential preference shares are not a commonly used term in finance.

A Preference Share with a Feature Allowing Preference Shareholders to Share