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प्रश्न
Justify the following statement.
Interim dividend cannot be paid out of free reserves.
उत्तर
- A dividend declared by the Board of Directors between two AGMs is called an Interim Dividend.
- The interim dividend is paid in the middle of the accounting year.
- It is paid before the finalisation of annual accounts for the year.
- Free Reserves are the reserves available for distribution of profits as per the latest audited Balance Sheet of the Company.
- It is declared out of profits of the current accounting year.
- Hence, Interim Dividend cannot be paid out of free reserves.
APPEARS IN
संबंधित प्रश्न
Distinguish between the following:
Interim dividend and Final dividend.
Interim Dividend is declared by ______________.
Write a word or a term or a phrase which can substitute the following statement.
Dividend declared between two AGMs.
Write a word or a term or a phrase which can substitute the following statement.
Dividend decided and declared by the Board.
Complete the sentence.
Interim dividend is decided and declared by ______.
Complete the sentence.
Payment of Interim Dividend needs to be authorized by ______.
Answer in one sentence.
What is Interim Dividend?
Answer in one sentence.
At which Meeting Interim Dividend is decided and declared?
Correct the underlined word and rewrite the following sentence.
Final Dividend is paid between two AGMs.
Arrange in Proper Order:
- Payment of Interim Dividend
- Board meeting deciding and declaring Interim Dividend.
- Authorization of Articles of Association.
Study the following case/situation and express your opinion :
ABC Co. Ltd. decides to pay Interim Dividend
- Can it be paid out of free reserves?
- Is the Board right in declaring the same at the Board Meeting?
- Can the company distribute the same within 30 days of its declaration?
Justify the following statement.
AGM is crucial for Final Dividend.
Justify the following statement.
Approval of members is not needed for Interim Dividend.
Explain Interim Dividend.
Diamond Company Limited is considering to declare Interim Divided:
- In how many days of declaration it should transfer the funds to Dividend Account?
- In how many days it must pay it to Shareholders?
- Can the Board of Directors declare Interim Dividend out of capital?
