A preference share that the issuing corporation at its option may retire by paying a specified amount to the preference shareholders is called:
A) Convertible preference share.
B) Callable preference share.
C) Premium share.
D) Cumulative preference share.
E) Participating preference share.

Question

Quizplus · Accepted Answer

A callable preference share is a type of preference share that can be redeemed (bought back) by the issuing corporation at its discretion. The corporation may choose to retire the shares by paying a specified amount to the preference shareholders, usually at a premium over the initial purchase price. This gives the corporation more flexibility to manage its capital structure and redeem or retire shares when it is financially beneficial.

A Preference Share That the Issuing Corporation at Its Option