CA Foundation Exam > CA Foundation Questions > Dividends are usually paid upon:a)Paid-up Cap...
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Dividends are usually paid upon:
- a)Paid-up Capital
- b)Called up Capital
- c)Issued Capital
- d)Reserve Capital
Correct answer is option 'A'. Can you explain this answer?
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Dividends are usually paid upon:a)Paid-up Capitalb)Called up Capitalc)...
Paid up means the amount which is received and company pay only on paid up
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Dividends are usually paid upon:a)Paid-up Capitalb)Called up Capitalc)...
Dividends are usually paid upon Paid-up Capital.
Dividends are a distribution of the company's profits to its shareholders. They are usually paid in proportion to the number of shares held by each shareholder. The amount of dividends that can be paid by a company is determined by its available profits.
When a company is incorporated, it issues shares to its shareholders. These shares represent the ownership interest in the company. The shareholders are required to pay a certain amount of money for each share they hold. This amount is called the called-up capital.
However, not all shareholders may have paid the full amount of the called-up capital. The amount that the shareholders have actually paid is called the paid-up capital. This is the amount that the company has received from the shareholders and can use for its operations.
Explanation:
Therefore, the correct answer is option 'A' - Paid-up Capital.
Dividends are a distribution of the company's profits to its shareholders. They are usually paid in proportion to the number of shares held by each shareholder. The amount of dividends that can be paid by a company is determined by its available profits.
When a company is incorporated, it issues shares to its shareholders. These shares represent the ownership interest in the company. The shareholders are required to pay a certain amount of money for each share they hold. This amount is called the called-up capital.
However, not all shareholders may have paid the full amount of the called-up capital. The amount that the shareholders have actually paid is called the paid-up capital. This is the amount that the company has received from the shareholders and can use for its operations.
Explanation:
Dividends are usually paid upon paid-up capital because this represents the actual amount of money that the company has received from the shareholders. It is the amount that the company can use for its operations and distribute as dividends to the shareholders.
The paid-up capital is calculated by multiplying the number of shares issued by the company by the amount paid per share. For example, if a company has issued 1,000 shares and the shareholders have paid Rs. 10 per share, the paid-up capital would be Rs. 10,000.
In contrast, called-up capital represents the total amount that the shareholders are required to pay for their shares. This may include the amount that has not yet been paid by the shareholders. Therefore, it does not accurately reflect the amount of money that the company has received and can distribute as dividends.
Issued capital represents the total number of shares that have been issued by the company. It does not take into account the amount paid for each share or the amount that has been paid by the shareholders.
Reserve capital is a portion of the company's profits that is set aside and not distributed as dividends. It is retained by the company for future use or investment. It is not directly related to the payment of dividends.
Therefore, the correct answer is option 'A' - Paid-up Capital.
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Dividends are usually paid upon:a)Paid-up Capitalb)Called up Capitalc)Issued Capitald)Reserve CapitalCorrect answer is option 'A'. Can you explain this answer?
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