Distinguish Between: Shares and Debentures

Discussion – Share and Debentures  – HSC Board – Easy way to learn and memorized – class 12th – S.P – Notes of source of business finance – Difference between  Shares & Debenture, Distinguish between  –  sources of business finance – Secretarial Practice – Notes,  & Distinguish Between – according to the New Textbook for HSC Board –Difference between, Study material, studies notes, study notes.

shares-and-depentures

Sr. NoPointsSharesDebenture
1.TypeShares are owned capital.Debenture are borrowed capital.
2.MeaningA share is a share in the shares capital of the company. A shares is the smallest denomination of the shares capital of company.A debenture is a bond of in debt ness under the common seal of the company.
3.StatusA share is an ownership security.A debenture is creditor ship security.
4.IncomeIncome on shares is dividend, it is depend upon the net profit of the company.Incomes on debentures are interest. It is paid every year whether the company earns profit or loss.
5.RankShares holders have the last rank in the repayment of capital.Debentures holders are paid before the payment to the share holders.
6.Market ValueMarket value of the shares keep changing as per the financial condition of the company.Market value of the debentures remains constant.
7.Security offeredNo security is offered for investing money in shares capital.Company can offer any asset as a security to debenture holders.
8.Nature of financeShare are suitable for long term finance.Debenture are suitable for short or medium term finance.

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