07-25-2009, 12:38 AM
Thanks a lot to both of u.
"Reply to query 1
The company can pay dividend to the extent of all the accumulated profits keeping the capital unaffected. The current year's loss does not make it illegal"
i would like to take that point further and suppose
Company has current year loss of Rs. 500,000 and accumulated profits of RS.100,000 and hence carry forward losses of Rs.400,000. further assume there is no minimum equity requirement and all other facts as mentioned in my first query be the same.
now what will be your answer with reason.
"Reply to query 1
The company can pay dividend to the extent of all the accumulated profits keeping the capital unaffected. The current year's loss does not make it illegal"
i would like to take that point further and suppose
Company has current year loss of Rs. 500,000 and accumulated profits of RS.100,000 and hence carry forward losses of Rs.400,000. further assume there is no minimum equity requirement and all other facts as mentioned in my first query be the same.
now what will be your answer with reason.
