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Which one of the following is correct with reference to payment of ordinary dividends ? :

<p>a. Liability to pay dividends arise upon declaration by the Board of Directors.</p> <p>b. The company is liable to pay dividends each year if it has declared operating profits for the year.</p> <p>c. Dividend is payable each year, even if the company is operating at a loss.</p> <p>d. Dividends paid are deductible expense for tax purpose.</p>

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Question added by Deleted user
Date Posted: 2014/09/22
Shamel Rashad, CMA
by Shamel Rashad, CMA , Advisor to the Chairman on Financial Control , Bavaria Egypt

A. Liability to pay dividends arises upon declaration of said dividends by the board of directors.

 

If I may add to this, in some countries, the board of directors is only allowed to propose dividends, but no dividend declaration is made until approval is received by the AGM.

FITAH MOHAMED
by FITAH MOHAMED , Financial Manager , FUEL AND ENERGY CO for transportion petroleum materials

. Liability to pay dividends arise upon declaration by the Board of Directors.

AFZAN WASIM
by AFZAN WASIM , STORE EXECUTIVE , AL ROSTAMANI TRADING COMPANY

B

georgei assi
by georgei assi , مدير حسابات , المجموعة السورية

b. The company is liable to pay dividends each year if it has declared operating profits for the year.

 

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