Advertisements
Advertisements
Question
Justify the following statement.
Equity shares get last priority in dividend.
Advertisements
Solution
- A dividend is a share in the distributable profits of the company to which the shareholder is entitled when it is formally declared by the company.
- The dividend is payable only to the registered shareholders of the company.
- Preference shareholders are entitled to dividends before it is paid to the equity shareholders as per the terms of the issue of preference shares.
- Equity shareholders will get dividends from residual profits. i.e. after paying to preference shareholders and arrears of dividend on cumulative preference shares.
- Thus, Equity shares get the last priority in dividends.
RELATED QUESTIONS
Write a word or a term or a phrase which can substitute the following statement.
Request by shareholder in prescribed form for payment of dividend into shareholders bank amount.
State whether the following statement is true or false.
Dividend is paid to registered shareholders of the company.
State whether the following statement is true or false.
Shareholders decide about the rate and amount of profit to be given as dividend.
State whether the following statement is true or false.
All categories of shareholders get a fixed rate dividend.
State whether the following statement is true or false.
IEPF is the fund created by company.
Complete the sentence.
Predecided and a fixed rate of dividend is paid to ______.
Answer in one sentence.
Who has right to recommend Dividend?
Select the suitable option for the following.
Govt. Fund ____________.
Select the suitable option for the following.
Preference Shares ____________.
Correct the underlined word and rewrite the following sentence.
Preference shareholders are given the last priority in payment of dividend.
Correct the underlined word and rewrite the following sentence.
Dividend is payable every year, irrespective of the profits made by the company.
Arrange in Proper Order:
- Recommendation of Dividend
- Checking sufficiency of profits
- Board Meeting
Arrange in Proper Order:
- Closure of Register of Members.
- Intimate Stock Exchange of Board Meeting.
- Intimate Stock Exchange of declaration of dividend.
Study the following case/situation and express your opinion:
GOLD Co. Ltd. declares a dividend of ₹ 10/- per share for F.Y. 2018-19.
- Is company under default, if the dividend was not paid within 30 days of its declaration?
- Is company right in transferring the unpaid dividend to its Debenture Reserve Account?
- Does the company have to transfer the amount of unpaid dividends to IEPF after 30 days?
Answer the following question.
Discuss legal provisions for declaration of dividend.
Dividends can be paid out of capital.
Study the following case/situation and express your opinion:
GOLD Co. Ltd. declares a dividend of ₹ 10/- per share for F.Y. 2019-20.
- Is the company under default, if the dividend was not paid within 30 days of its declaration?
- Is the company right in transferring the unpaid dividend to its Debenture Reserve Account?
- Does the company have to transfer the amount of unpaid dividends to IEPF after 30 days?
