Multiple Choice Questions on Before declaration of dividend company transfer of its net profit for that year to reserves ........ for SEBI Grade A ( Officer) Exam Preparation

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Multiple Choice Questions

Before declaration of dividend company transfer of its net profit for that year to reserves ........

Companies Act-Phase (I & II) Paymentofdividends
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    Before declaration of dividend, company transfer_______________% of its net profit for that year to reserves.

    25% of the Net Profit

    Incorrect Answer

    15% of the Net Profit

    Incorrect Answer

    10% of the Net Profit

    Incorrect Answer

    Such % as company consider appropriate, if any.

    Correct Answer
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    Explanation:

    As per Section 123 of Companies Act, 2013, there is no compulsion to transfer any amount to reserves before payment of dividend to the shareholders and % if any to be transferred to reserves depends upon the discretion of BODs.

    By: Vikas Goyal
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