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JAMB Principles of Accounts 1998 Question 40

Question 40

Company Accounts

The ordinary shareholders enjoy the following rights except the right to

  1. A.vote at annual general meetings
  2. B.elect the board of directors
  3. C.participate in additional issues of shares
  4. D.receive dividends at a predetermined rate.
Show the answer and explanation

Answer: D (receive dividends at a predetermined rate.)

Explanation

A fixed (predetermined) dividend rate belongs to preference shareholders; ordinary dividends vary.