What is preference share and it's …

Preference shares are shares which are preferred over common or equity shares in payment of surplus or dividend i.e preference shareholders are the first to get dividends in case the company decides to pay out dividends.

Different types of Preference Shares are as follows:
1) Cumulative Preference Share In case where a company does not declare dividends for a particular year, they are carried to next year. They are treated as arrears.And a preference share is said to be cumulative in a case when the arrears pertaining to dividend are cumulative in nature and such arrears are cleared before any dividend payment to equity shareholders.
2) Non- Cumulative Preference shares: As the name suggests, it does not accumulate dividends. Dividend skipped by the company are not paid, which means they have the right to avail dividend from the profits earned from that particular year.
3) Redeemable Preference shares: These are shares which can be redeemed or repaid after the fixed period as issued by the company or even before at the option of the company. .
4) Non-redeemable These shares cannot be redeemed during the life of the company.
5) Convertible Shares Shares can be converted into equity at the option of the holder after the stated tenure. 6) Non-convertible shares Shares which cannot be converted to equity are called non convertible shares.
7) Participating shares Such shares have the right to participate in surplus profits of the company at the time of liquidation after the company had paid to other holders.
8) Non-participating Preference Shares Preference shares, which have no right to participate in the surplus profits or in any surplus on liquidation of the company, are called non-participating preference shares.