Differences between equity finance and preference, Finance Basics

Differences between Equity Finance and Preference

Dissimilarity between Equity Finance and Preference are as follows:


Ordinary share capital


Preference share capital








Has a residue claim both on assets and profit

Carries voting rights

Reduces the gearing ratio

Variable dividends hence grow over time

Permanent finance

Easily transferable.








Has a superior claim

No voting rights

Increases the gearing ratio

Fixed dividends hence no growth

Usually redeemable

Not easily transferable


Posted Date: 1/29/2013 4:41:08 AM | Location : United States

Related Discussions:- Differences between equity finance and preference, Assignment Help, Ask Question on Differences between equity finance and preference, Get Answer, Expert's Help, Differences between equity finance and preference Discussions

Write discussion on Differences between equity finance and preference
Your posts are moderated
Related Questions
'The most significant function of any Central Bank is to undertake monetary control operations'.   Discuss with specific reference to the Bank of England, highlighting its current

Describe the duties of the financial manager in a business firm? Financial managers calculate the firm's performance, define what the financial consequences will be if the firm

What are depository institutions? Depository institutions: intermediaries along with an important proportion of their funds derived through customer deposits as consists of: co

Production data has been fit to a Fetkovich type curve. Given the following information, answer the questions: Date of first production plotted for the Fetkovich type curve matc

Net Present Value Method - DCF Technique The method discounts outflows and inflows and ascertains the total present value via deducting discounted outflows from discounted inf

Price Earnings Ratio Price earnings (P/E) or ratio =  Market price per share (MPS)/Earnings per share                                     OR    = Market value of equity /Ea

A bondholder buys a bond maturing in two years for Rs. 120 and earns Rs.15 per annum as interest. His YTM is ______ %.

The Audiology Department at Randall Clinic offers many services to the clinic’s patients. The three most common , along with cost and utilization data, are as follows: Service Var

Current cost of a bond: You know that the after-tax cost of debt capital for Bubbles Champagne is 7 percent. If the firm has only one issue of five-year maturity bonds outstanding,

Contracting Cost - Agency Costs These are costs acquired in devising the contract between the shareholders and managers. The contract is drawn to ensure management act in t