What is Prefrential Share & Debentures?

Question

Can anyone explain me about Prefrential shares and Debentures?

Answer 1

Preference Shares:
Capital stock which provides a specific dividend that is paid before any dividends are paid to common stock holders, and which takes precedence over common stock in the event of a liquidation. Like common stock, preference shares represent partial ownership in a company, although preferred stock shareholders do not enjoy any of the voting rights of common stockholders. Also unlike common stock, preference shares pay a fixed dividend that does not fluctuate, although the company does not have to pay this dividend if it lacks the financial ability to do so. The main benefit to owning preference shares are that the investor has a greater claim on the company’s assets than common stockholders.

Debentures:
A long-term debt issued mainly to evidence an unsecured corporate debt. Debentureholders receive interest.

Answer 2

preference shares are those shares which get preference for payment of dividend and repayment of capital at the time of winding up of the business.
debenture is a borrowed fund .
both have fixed rate of return.