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Can a government company declare interim dividend If yes then what is the procedure for that?
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What happens when a company Declares Quarterly Dividend?
It means that the company would share its profit with its share holders once every 3 months of the year. The Dividend % is decided based on the profits made by the company during the current fiscal quarter. Let us say a company has a face value of Rs. 10/- and decides to declare a dividend of 25% it means that for every share you hold in that company you will get Rs. 2.5/- as dividend.
What does declare a dividend mean?
Declaring a dividend is a corporate action taken by the board of directors of a company. Usually this is done once or twice a year when the company's financial results are declared and the company has made handsome profits/revenues. Dividend is usually declared as a % of the face value of a share. A 100% dividend on a Rs. 1/- face value share represents a dividend of Rs. 1/- similarly a 100% dividend on a Rs. 10/- face value share represents a dividend of Rs. 10/- Ex: You hold 1000 shares of XYZ limited with a face value of Rs. 5/- the company has declared a 50% dividend. Then you would receive Rs. 2,500/- as dividend.
How do you declare dividends?
declared and paid a $900 dividend
Who can declare a dividend for a corporation?
The board of directors only.
Is it compulsory to pay dividends on common equity?
No it is not. Dividends are a means of sharing the profit of a company with the share holders of that company but it is not compulsory. Companies usually declare dividends when they have a good financial year and make solid profits. If the year went bad, the company may opt not to declare any dividend that year.
What is the accounting double entry when a company declare or pay dividend to its holding overseas company with 10 percent local withholding tax rate?
Let's say the dividend payable is $110. When the dividend is declared (eg the decision is made to pay a dividend but the dividend and tax won't be paid until, say, the first day of next month) then the entry is: Debit "Dividends Expense" (Expense Account) $110 Credit "Dividend Payable Parent Company" (Liability Account) $100 Credit "Dividend Tax Withheld" (Liability Account) $ 10 When the dividend and Tax is actually paid (eg it is now the first day of next month) the entry is: Debit "Dividend Payable Parent Company" (Liability Account) $100 Debit "Dividend Tax Withheld" (Liability Account) $ 10 Credit "Bank Account" (Asset Account) $110
What is interium dividend?
Interim Dividend: Companies can pay dividend at the end of financial year which is called final dividend but sometimes companies declare two dividends one in the middle of the financial years that dividend is called interim dividend and then one at the end of the financial year which is called final dividend.
Whether a company can declare dividend out of capital profits?
Yes, a private company can distribute dividends from capital profits in English law. The companies Act 2006 contains restrictions on dividend distributions (section 830 onwards) but does not differentiate between capital and revenue profits. As long as the capital profit is realised it is allowed.
Why does a company issue bonus shares?
Sometimes a company might not have made any profit during the year but would not like to leave the shareholders hanging.Therefore it might liquidate certain reserves which under statute cannot be used to declare a dividend but can be used to declare a bonus issue.Bonus Issues are also very cheap for the company and do not interfere with the debt-equity structure of the enterprise.
What dividend per share should the company declare If Collins Inc latest net income was 1 million and it had 200 000 shares outstanding and the company wants to pay out 40 percent of its income?
net income = $1,000,000 x payout ratio = 40% total payout = $400,000 divided by 200,000 shares outstanding dividend per share = $2.00
The shareholders at an annual general meeting passed a resolutionfor the payment of dividend ata rate higher than recommended by the Board of Directors Examine the validity of the resolution Explain?
Articles of companies usually contain provisions with regards to declaration of dividend on the pattern of regulations 85 to 94 of Table A of the Companies Act, 1956. Under the regulation 85, the power to declare a dividend vests with the general meeting, but it has no power to declare a dividend exceeding the amount recommended by the Board of Directors.
What are the benefits of holding a company's share?
1. If you hold shares of a company, you are one of the owners of that company. Every year the company would send you its annual statement, its profit & loss accounts etc. Also if they have made a good profit, they would even declare a Dividend. A Dividend is something like Interest that you receive from a bank for holding a deposit with it. The only difference is that you may or may not get Dividends. Assuming you hold 100 shares of XYZ limited and they declare a dividend of 50% per equity share it means you would be getting Rs. 5/- per share that you hold in the company. The Dividend % that any company declares is on the Face value of its share. That is you would be getting Rs. 500/- as a dividend. 2. Whenever the company takes any major decisions like change of the CEO or Acquisition of another company etc, you would be communicated. There would be a share holders meeting and only if at least 51% of the company's share holders approve the corporate action would happen. 3. As you know, the shares of the company would be traded in the secondary market everyday. Say after 3 months the Market value of the share of XYZ limited has become Rs. 70 per share, you can sell the shares of XYZ and make Rs. 7000/- which is a profit of Rs. 2000/- in 3 months
