Concept:A first charge against profit is the payment that must be made before other shareholders receive any share of the profit.
Preference shareholders hold a priority right over ordinary shareholders in dividend distribution.
Explanation:Preference dividend is a fixed dividend paid to preference shareholders before any ordinary dividend is declared.
When a company prepares its profit and loss appropriation account, preference dividend is treated as the first charge against profit.
Ordinary dividend can only be paid after preference dividend has been provided for.
Capital reserve and general reserve are appropriations of profit, not charges that come before preference dividend.
Thus, among the given options, preference dividend is the item that ranks first against profit.
Answer:B. preference dividend