CA Foundation Exam  >  CA Foundation Questions  >  The authorized capital of M Ltd. consists of ... Start Learning for Free
The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10.  During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.
 
Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?
  • a)
    Rs.3,000
  • b)
    Rs.5,000
  • c)
    Rs.10,000
  • d)
    Rs.12,000
Correct answer is option 'A'. Can you explain this answer?
Most Upvoted Answer
The authorized capital of M Ltd. consists of both cumulative preferenc...
Calculation of total dividend:

- Dividend declared in 2004-05 = Rs.8,000
- Dividend declared in 2005-06 = Rs.15,000

Calculation of total dividend payable to preference shareholders:

- Cumulative preference share capital balance = Rs.2,00,000
- Cumulative dividend payable on each preference share = 5% of par value = 5% of Rs.100 = Rs.5
- Total number of preference shares = Cumulative preference share capital balance / Par value of preference share = Rs.2,00,000 / Rs.100 = 2,000
- Total cumulative dividend payable to preference shareholders for the year 2005-06 = Cumulative dividend payable per preference share * Total number of preference shares = Rs.5 * 2,000 = Rs.10,000

Calculation of dividend payable to equity shareholders:

- Total dividend declared for the year 2005-06 = Rs.15,000
- Dividend payable to preference shareholders = Rs.10,000
- Dividend payable to equity shareholders = Total dividend declared - Dividend payable to preference shareholders = Rs.15,000 - Rs.10,000 = Rs.5,000

Therefore, the dividends allocated to the equity shareholders in the year 2005-06 is Rs.3,000 (Option A is incorrect, the correct answer is Rs.5,000).
Explore Courses for CA Foundation exam
The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer?
Question Description
The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer? for CA Foundation 2024 is part of CA Foundation preparation. The Question and answers have been prepared according to the CA Foundation exam syllabus. Information about The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer? covers all topics & solutions for CA Foundation 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer?.
Solutions for The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer? in English & in Hindi are available as part of our courses for CA Foundation. Download more important topics, notes, lectures and mock test series for CA Foundation Exam by signing up for free.
Here you can find the meaning of The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer? defined & explained in the simplest way possible. Besides giving the explanation of The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer?, a detailed solution for The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer? has been provided alongside types of The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer? theory, EduRev gives you an ample number of questions to practice The authorized capital of M Ltd. consists of both cumulative preference shares and equity shares. Each 5% cumulative preference share has a par value Rs.100. Each equity share has a par value Rs.10. During the year April 01, 2005 to March 31, 2006, the cumulative preference share capital balance was Rs.2,00,000 and the equity share capital balance was Rs.5,00,000.Q.If dividend declarations totalled Rs.8,000 and Rs.15,000 in the year 2004-05 and 2005-06 respectively, the dividends allocated to the equity share holders in the year 2005-06 = ?a)Rs.3,000b)Rs.5,000c)Rs.10,000d)Rs.12,000Correct answer is option 'A'. Can you explain this answer? tests, examples and also practice CA Foundation tests.
Explore Courses for CA Foundation exam

Top Courses for CA Foundation

Explore Courses
Signup for Free!
Signup to see your scores go up within 7 days! Learn & Practice with 1000+ FREE Notes, Videos & Tests.
10M+ students study on EduRev