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CSEET · Business Laws and Management · Elements of Company Law

Match the following under Section 43 of the Companies Act, 2013. (P) Equity share capital (Q) Preference share capital (R) Differential rights. Items: (1) Fixed rate dividend and preferential repayment (2) All share capital which is not preference capital (3) Rights as to dividend, voting or otherwise per prescribed rules. Choose the correct matching.

The correct matching is equity capital with all share capital that is not preference capital, preference capital with fixed dividend and preferential repayment, and differential rights with rights as to dividend, voting or otherwise under prescribed rules.

  1. AP-1, Q-2, R-3
  2. BP-2, Q-1, R-3Correct
  3. CP-3, Q-2, R-1
  4. DP-2, Q-3, R-1

Explanation

Equity capital is all capital not being preference capital (2). Preference capital carries preferential dividend at a fixed amount or rate and preferential repayment (1). Differential rights relate to dividend, voting or otherwise as prescribed (3).

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