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Question: What is the difference between Debenture and Preference share ?

Answer: When the capital of the company is not sufficient to carry on business the company raise loan by issuing what is known as debenture debenture holder money treated as a loan whereas preference shareholder money treated as a capital of the company. Debenture holder is not a properitor of the company in the contest preference share holder is a properitor of the company. Preference share holder has a right to get bonus or dividend from the company but debenture holder has no right to get dividend.

When the capital of the company is not sufficient to carry on business the company raise loan by issuing what is known as debenture debenture holder money treated as a loan whereas preference shareholder money treated as a capital of the company. Debenture holder is not a properitor of the company in the contest preference share holder is a properitor of the company. Preference share holder has a right to get bonus or dividend from the company but debenture holder has no right to get dividend. Source: CoolInterview.com

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