A Preference Share Is a Financial Liability

question 37

Multiple Choice

A preference share is a financial liability:

• A) if it provides for mandatory redemption by the issuer for a fixed or determinable amount at a fixed or determinable future date.
• B) if it gives the holder the right to require the issuer to redeem the instrument at or after a particular date for a fixed or determinable amount.
• C) if it gives the issuer the sole discretion to redeem the instrument at a date of their choice for a fixed or determinable amount.
• D) if it provides for mandatory redemption by the issuer for a fixed or determinable amount at a fixed or determinable future date and if it gives the holder the right to require the issuer to redeem the instrument at or after a particular date for a fixed or determinable amount.