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A distributable reserve, which is specifically set up to ensure that dividends remain stable despite, changes in earnings.
If a company normally pays a dividend of 10 per cent per share, the directors might establish a dividend equalisation reserve so that this dividend level is protected against the eventuality of unprofitable years.
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What are the example of Revenues?
Revenue reserve is created out of revenue Profit . It is created out of Revenue Profit for exaple General Reserve, Dividend equalization reserve, Investment fluctuation reserve etc.
What are the examples of revenue reserves?
Revenue reserve is created out of revenue Profit . It is created out of Revenue Profit for exaple General Reserve, Dividend equalization reserve, Investment fluctuation reserve etc.
When was Revenue Equalization Reserve Fund created?
Revenue Equalization Reserve Fund was created in 1956.
What is a distributable reserve?
A non-distributable reserve is one which is not available for distribution to shareholders as a dividend.
What is reserve distribution?
A non-distributable reserve is one which is not available for distribution to shareholders as a dividend.
What is a non-distributable reserve?
A non-distributable reserve is one which is not available for distribution to shareholders as a dividend.
How can you utilise the general reserve?
By providing dividend to share holder
What is the difference between general reserve and revenue reserve?
A reserve which is created out of the revenue profit is called revenue reserve. Revenue profit is earned in the normal course of the business. Revenue reserve refers to the undistributed revenue profit. It is created for strengthening the financial position, replacing deprecialble assets, redeeming liabilities, declaring uniform rate of dividend and conducting research and development functions. If the reserve is not needed in the future, it can be distributed as dividend to the shareholders.There are two types of revenue reserve:a) General ReserveA reserve which is created out of the profit not for a specific purpose is known as general reserve.General reserve is used for general purpose as per the discretion of the management. Usually, general reserve is used for strengthening the financial position and meeting future contingencies and losses.b) Specific ReserveA reserve which is created out of the profit for a particular purpose is known as specific reserve. Such reserve can not be utilized for any purpose other than specified. Specific reserve is created by debiting the profit and loss appropriation account. It can be invested in outside securities. It serves for a specific purpose as to equalize dividend or to redeem a fixed liability or to replace a fixed assets or to conduct a research and development work.The following are the important types of specific reserve:* Dividend equalization fund* Sinking fund* Research and development fund
What is a dividend equalisation fund?
Dividend equalisation refers to the distributable portion (non taxable) of the fund created to equalise the dividend payable on units purchased at different times. It is also revenue reserve that acts as a buffer between a certain dividend level and profits available. The sums are usually transferred to this reserve account in good years, and withdrawn from in poor years to maintain the dividend amount.
What will the federal government (federal reserve bank) do in an attempt to encourage saving and investing?
raise dividend rates
What will the federal government (Federal Reserve Bank) do I an attempt to encourage saving and investing?
raise dividend rates
What will the federal government (Federal Reserve Bank) do in an attempt to encourage saving and investing?
raise dividend rates
