y XYZ limited has the following capital structure:

Kshs.

10,000 Kshs. 10 ordinary shares 100,000

10,000 Kshs. 20 preference shares ` 200,000

Total shares capital 300,000

If the company assets were Kshs. 400,000 show this would be shared under

i) Participative (5 marks)

ii) ratio (5 marks)

Share participation taking into account the par value.

ii) What are the advantages and disadvantages of using Debt Finance as a source