Question

During the current year, sally sold her interest in two small business coeporations?

Answer 1

Answer:The answer is shares

Explanation:

A share is a unit of capital of a company which a company issued out to the members of the public for subscription. It is usually issued out to the members of the public in denominations for example $1, the capital of a limited company is divided into the following shares which are

Ordinary shares : This is also known as common shares, it is a share which carry the main risk of the business. The holders of ordinary shares are not guaranteed a dividend at the end of the year because this depends on whether or not the company's make profit. If the company makes profit holders of ordinary shares will receive dividend .however, the holders of ordinary shares have a voting right at the annual general meeting of the company.

Preference shares : The owners of these shares receive fixed rate of interest per annum for example 10% or more.holders of these shares receive preference in the payment of dividend, and also in the repayment of capital if the company is forced to wind up. Therefore, preference shareholders are safer than the owners of ordinary shares.

Cumulative preference shares : The owners of this shares can have their losses in income in bad years made up in good years. This means they can accumulate their dividends, if the company does not have enough money to pay preference shareholders in a particular years,they will therefore get their money in later years.

Participating preference shares : The holders of participating preference shares receive a fixed dividend and also received an additional dividend if the company makes a profit above a certain level.

Deferred shares : These are special types of shares which carry particular rights and privileges. They are sometimes issued to the promoters and founders of a company. Holders of deferred shares do not receive any dividend untill all other types of shareholders have been paid.

However, a person can sold his or her interest in a business corporation which means such a person has sold his or her own shares in the business. This can be done through a stockbrokers, the stockbrokers look for buyers for members of the public who wants to sell shares and sellers for those who wants to buy shares. They are paid a commission known as brokerage for their services.