GENERAL KNOWLEDGE

Detailed explanation-1: -Preference shareholders have priority on payment of dividend over equity shareholders. However, in the case of interim dividend, while preference shareholders need not necessarily be paid dividend before equity shareholders.

Detailed explanation-2: -Preference shares are company stock with dividends that are paid to shareholders before common stock dividends are paid out. Cumulative preferred stock refers to shares that have a provision stating that, if any dividends have been missed in the past, they must be paid out to preferred shareholders first.

Detailed explanation-3: -Often, companies pay dividends to preference shareholders as a fixed percentage or in priority to other shareholders until the preference shareholder has been repaid a set amount.

Detailed explanation-4: -Dividends are generally paid in cash or additional shares of stock, or a combination of both. When a dividend is paid in cash, the company pays each shareholder a specific dollar amount according to the number of shares they already own.