How will Unclaimed dividend treated in cash flow statement?

Question

Answer

Unclaimed Dividend should be deducted from the amount of Proposed Dividend Paid because it represents that amount of Dividend which is not yet paid....in financing activities....

Answer

Frst add it in appropriations and then less it in financing activities.

Answer

Unclaimed Dividend Treatment in Cash Flow Statement

In accounting, unclaimed dividend is the amount of money that is due to the shareholders but has not been claimed for a certain period of time. The treatment of unclaimed dividend in the cash flow statement depends on whether the company has paid the dividend or not.

If the company has paid the dividend

The unclaimed dividend is considered as a cash outflow in the financing activities section of the cash flow statement.

The amount of unclaimed dividend is deducted from the total dividend paid to the shareholders.

The unclaimed dividend is included in the total cash outflow from financing activities.

If the company has not paid the dividend

The unclaimed dividend is not included in the cash flow statement since it has not been paid.

The unclaimed dividend is recorded as a liability in the balance sheet until it is paid or escheated to the state government as unclaimed property.

When the unclaimed dividend is paid, it will be treated as mentioned above.

Conclusion

Unclaimed dividend has an impact on the cash flow statement of the company. The treatment of unclaimed dividend in the cash flow statement depends on whether the dividend has been paid or not. If the dividend has been paid, the unclaimed dividend is treated as a cash outflow in the financing activities section. If the dividend has not been paid, the unclaimed dividend is not included in the cash flow statement.

Similar Commerce Doubts

What will be the treatment of UNCLAIMED DIVIDEND(equity) of current year when there is no balance inprevious year also we have intrim dividend of 1lac in adjustment in CASH FLOW STATEMENT?

What will be the treatment of proposed dividend in cash flow statement ?

Payment of dividend and interest will be classified as which type of activity while preparing cash flow statement?

Treatment of unpaid dividend while preparing cash flow statement ?

How can we solve proposed dividend in cash flow statement ?

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