Dividend Declaration Limit (FS chapter)

Accountancy

In dividend declaration limit, under condition 2, it's 10% of paid up capital and free reserves. Question: If there is an existing PL balance, which is not sufficient, then will it also be included while checking condition 2? Is PL surplus a free reserve?

Deepak Gupta

CA Inter

★ 1K+

14-Nov-20 14:37

671

Answers (2)

I think I goofed up here... PL won't be included as it is already short and we are withdrawing from other fund... right na?

Thread Starter

Deepak Gupta

CA Inter

★ 1K+

14-Nov-20 14:42

Limits is when you have to withraw from free reserves like general reserve.

CA Suraj Lakhotia

Admin

15-Nov-20 12:52