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Why it is said that equity shareholders are the residual owners?

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Question

Why it is said that equity shareholders are the residual owners?

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Solution

Since they do not receive a fixed dividend, instead, they receive payments only after government taxes, debenture interest, and preference dividends have been settled.

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Chapter 18: Sources of Business Finance - EXERCISES [Page 269]

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C. B. Gupta Business Studies [English] Class 12 ISC
Chapter 18 Sources of Business Finance
EXERCISES | Q I. C. 16. | Page 269
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