Question 4 of 61beginner🧠 RememberMCQ1 mark
Equity shareholders are:
Exercise: Test your Understanding – II | Q: 1(a) | (Page 35)
For More Understanding
Explanation
Option (ii) is correct. The provided context states that equity shareholders are entitled to share the distributable profits of the company and the equity share capital may carry voting rights. These rights to profits and participation in management (through voting) are characteristics of ownership. Unlike creditors (who lend money) or customers (who buy goods), equity shareholders bear the ultimate risk and reward of the company, making them the owners.