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According to the Companies Act, 1956, what conditions must be fulfilled before a company can declare a dividend for a financial year?
  • a)
    The company must have zero accumulated losses.
  • b)
    The company must provide for depreciation for the current financial year.
  • c)
    The company must have no outstanding debts.
  • d)
    The company's profits should be higher than the previous year's profits.
Correct answer is option 'B'. Can you explain this answer?
Most Upvoted Answer
According to the Companies Act, 1956, what conditions must be fulfille...
As per the Companies Act, 1956, before declaring a dividend for a financial year, the company must provide for depreciation for the current financial year. This provision ensures that the company sets aside an amount to cover the wear and tear of its assets, thereby safeguarding the interests of shareholders.
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According to the Companies Act, 1956, what conditions must be fulfilled before a company can declare a dividend for a financial year?a)The company must have zero accumulated losses.b)The company must provide for depreciation for the current financial year.c)The company must have no outstanding debts.d)The company's profits should be higher than the previous year's profits.Correct answer is option 'B'. Can you explain this answer?
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According to the Companies Act, 1956, what conditions must be fulfilled before a company can declare a dividend for a financial year?a)The company must have zero accumulated losses.b)The company must provide for depreciation for the current financial year.c)The company must have no outstanding debts.d)The company's profits should be higher than the previous year's profits.Correct answer is option 'B'. Can you explain this answer? for B Com 2024 is part of B Com preparation. The Question and answers have been prepared according to the B Com exam syllabus. Information about According to the Companies Act, 1956, what conditions must be fulfilled before a company can declare a dividend for a financial year?a)The company must have zero accumulated losses.b)The company must provide for depreciation for the current financial year.c)The company must have no outstanding debts.d)The company's profits should be higher than the previous year's profits.Correct answer is option 'B'. Can you explain this answer? covers all topics & solutions for B Com 2024 Exam. Find important definitions, questions, meanings, examples, exercises and tests below for According to the Companies Act, 1956, what conditions must be fulfilled before a company can declare a dividend for a financial year?a)The company must have zero accumulated losses.b)The company must provide for depreciation for the current financial year.c)The company must have no outstanding debts.d)The company's profits should be higher than the previous year's profits.Correct answer is option 'B'. Can you explain this answer?.
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