The performance of candidates in this question was rather poor. The following answers should be noted.

(i)Limited partner: A partner whose liability for the debts of the business is restricted to amount of capital invested in the business, He is not allowed to take part in the management of the business. In all limited partnerships there must be at least general partner with unlimited liability.

(ii)Ordinary shares: These are also called equities because they share the remaining profits only after other claims. have been met. They do not receive fixed rate of dividend. Their dividends fluctuate with the rise and fall in profits. Ordinary shares hear most of the risks of the business. They have superior voting right.

iii)Debenture: This is an evidence of loan to a company. It attracts a fixed rate of interest which is payable whether profits are made or not. The debenture may be secured on the assets of the Company and is repaid before any other creditors in case of dissolution etc.