Question

Distinguish between Shares and Debentures.

Answer 1

Shares	Debentures
Shareholders are the owners of the company	Debenture holders are the creditors of the company
Shareholders get dividends	Debenture holders get interest
Shareholders have voting right	Debenture holders have no voting right
No security is required to issue shares	Generally debentures are secured
Shares are not redeemable	Debentures are redeemable
Share capital is payable after paying all outside liabilities	Debenture holders have the priority of repayment over shareholders