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Companies Act-Phase (I & II) Share capital and debentures Add to Study Deck

………………..depicts lenders interest in the company with limited risks and returns.

Preference shares

Debentures

Equity shares

Both a and b

Explanation:

Debenture holders are creditors of the company whose return is limited to the rate of interest (irrespective of the profit earned) and risk arises only during liquidation of the company. Whereas Preference shareholders earning is based on the profits of the company.