This article throws light upon the top four legal and procedural aspects of payment of dividend. The legal and procedural aspects are: 1. Source of Declaring Dividend 2. Transfer to Reserves 3. Declaration of Dividend out of Past Profits or Reserves 4. Other Provisions and Aspects of Payment of Dividend. Legal and Procedural Aspects of Payment of Dividend: Source of [...]
Here is a compilation of top five problems on bonus issue of shares with their relevant solutions. Bonus Issue of Shares: Problem with Solution # 1: The following are the extracts from the draft Balance Sheet of A Ltd., as on December 31,2010 A resolution was passed by the company declaring bonus of 25% on equity shares to be provided [...]
The main consideration in determining the dividend policy is the objective of maximisation of wealth of shareholders. Thus, a firm should retain the earnings if it has profitable investment opportunities, giving a higher rate of return than the cost of retained earnings, otherwise it should pay them as dividends. It implies that a firm should treat retained earnings as the [...]