Where There Is a Redemption of Preference Shares 'Out of Profit

question 6

Multiple Choice

Where there is a redemption of preference shares 'out of profit':

• A) The redemption is recorded in the appropriations section of the profit and loss account.
• B) The redemption is recorded as an expense.
• C) The redemption is recorded as a liability and is amortised over a maximum of five years.
• D) The redemption is not recorded in the current period.
• E) The redemption is recorded against opening retained profits.

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Definitions:

Anxious

A feeling of worry, nervousness, or unease about something with an uncertain outcome.

Hostile

Exhibiting or feeling aggression and antagonism towards others.

Affiliation Motive

Being motivated by one’s relationships with others.

Power Motive

An individual's desire to exert control or influence over others or situations.