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[Debit] Proposed dividend [Credit] Dividend payable
Proposed Dividend means a dividend that is paid by the company that the end of a finical year.
1)Preference Shares have 2 preferences first payment of dividend in every year in which dividend is proposed & first share capital of preference shares will be payab;e @ winding up or liquidation of the company,where as equity share holders dividend after preference share holders & even share capital capital is also paid after paying to preference share holders. 2)preference share holders are not owners of the company and do not enjoy any voting right. Where as Equity Shares has voting right & they are the real owners of company. 3)Preference Shares have a finite tenure and carry a fixed rate of dividend where as dividend to equity shares is payable rest of the dividend payable after preference share holders.
yes we will pass entry for proposed dividend P&L Appropriation A/c Dr. To Proposed Dividend
Proposed dividend is that which is proposed by the management to be paid to share holders of company.Declared dividend is the dividend which is finalized in annual general meeting to be paid to share holders.
A company proposes a dividend to be paid to shareholders. The shareholders vote on this and the dividend that is actually paid may differ from that proposed.
Proposed dividend refers to the amount expected to be paid to shareholders. Final dividend is the official dividend paid to shareholders at the end of a financial year.
Here the difference is that the dividend is a amount decided to be given to, say the shareholders, and proposed dividend is the amount has not yet been decided at the meeting , for the sareholders as yet.
One of the limitations to preference shares is that the shareholder does not have a voting right. Preference shares normally pay a fixed dividend where common stocks do not pay a fixed dividend.
Yes following entry required: [Debit] Proposed dividend [Credit] dividend payable
[Debit] Proposed dividend [Credit] Dividend payable [Debit] Dividend payable [Credit] Cash / bank
preference shareholder can get dividend on fixed based and preference shareholder not have voting rights and equity share holder has right to vote and to get dividend