Which investment form may have a cumulative right to dividends?

Preference shares typically come with specific rights that set them apart from ordinary shares and debentures. One of the key features of preference shares is that they often have a cumulative right to dividends. This means that if dividends are declared, but not paid in a particular year, they accumulate and must be paid out in the future before any dividends can be distributed to ordinary shareholders.

Cumulative preference shares ensure that shareholders have the right to receive their due dividends even if the company faces financial difficulties and cannot pay dividends in some years. This characteristic makes preference shares appealing to investors seeking a more stable income stream, especially in volatile markets. On the other hand, ordinary shares do not carry any guaranteed dividend rights and dividends paid can fluctuate based on the company's profitability.

Debentures, whether secured by a fixed charge or a floating charge, primarily serve as debt securities and do not typically offer cumulative rights to dividends since they pay interest rather than dividends. The interest due on debentures must be paid according to their terms but does not accumulate in the same way dividends do for preference shares. This clear distinction in the rights associated with these investment forms highlights why preference shares are the correct answer in this context.