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Dividends are usually paid as a percentage of ______.
  • a)
    Authorized share capital
  • b)
    Net profit
  • c)
    Paid-up capital
  • d)
    Called-up capital
Correct answer is option 'C'. Can you explain this answer?
Verified Answer
Dividends are usually paid as a percentage of ______.a)Authorized shar...
Dividends are usually paid as a percentage of Paid-up capital.

Explanation:

  • Dividends are the distribution of profits made by a company to its shareholders.

  • Paid-up capital refers to the amount of capital that the shareholders have actually paid for their shares.

  • Dividends are typically calculated as a percentage of the paid-up capital.

  • This means that shareholders receive dividends based on the amount of capital they have invested in the company.

  • Dividends can be paid in different forms, such as cash dividends or stock dividends.

  • However, regardless of the form, the calculation of dividends is generally based on the paid-up capital.



Answer: C. Paid-up capital

Summary:
Dividends are usually paid as a percentage of the paid-up capital. Paid-up capital refers to the amount of capital that shareholders have actually paid for their shares. Dividends are calculated based on this capital investment.

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Dividends are usually paid as a percentage of ______.a)Authorized share capitalb)Net profitc)Paid-up capitald)Called-up capitalCorrect answer is option 'C'. Can you explain this answer?
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