ACCA · Question 18 · Corporate and Business Law
Which of the following is a key difference between share capital and loan capital?
Answer options:
Shareholders are creditors of the company, while debenture holders are members.
Interest on loan capital must be paid regardless of profitability, whereas dividends on share capital are paid only out of distributable profits.
Share capital can be secured by a floating charge, but loan capital cannot.
Loan capital carries voting rights at general meetings, whereas share capital does not.
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