Dividends out of the capital profits , Financial Accounting

Dividends out of the capital profits

Dividends out of the capital profits are apportioned on the same basis as dividends out of income (Re. Doughty).

(a) Variation of securities:
It would seem logical to carry out a strict apportionment between income and capital every time investments are bought or sold.  If this were done, it would be necessary to divide the purchase price or sale proceeds between the pure capital element and the adjustment of income rights.

(b) Equitable apportionments:

There are five leading cases where the courts have laid down rules to meet specific situations in which there is a conflict of interest between life tenant and remainderman. Equitable apportionments may be (and frequently are) barred by the will.

Posted Date: 12/13/2012 5:25:20 AM | Location : United States







Related Discussions:- Dividends out of the capital profits , Assignment Help, Ask Question on Dividends out of the capital profits , Get Answer, Expert's Help, Dividends out of the capital profits Discussions

Write discussion on Dividends out of the capital profits
Your posts are moderated
Related Questions
USAco is the wholly-owned U.S. subsidiary of ASIAco, a Japanese parent corporation that manufactures automobiles and sells them to USAco for resale in the United States. ASIAco sel

Experienced Auditor - An AUDITOR who has a reasonable understanding of audit activities and has studied company's industry as well as accounting and auditing issues relevant to the

prepare your recommendation on Agarwal cast company

QUESTION 1: P A RT A You  are  given with  the  following information relating to Rooney PLC . The accountant is currently developing the budget for the next three mo

Clarkston Inc issued $1,000,000 of convertible 10- year, 11% bonds on July 1, 2014. The interest is payable semiannually on January 1 and July 1. The discount in connection with th

I've tried everything im just really lost. I have to enter into T accounts. Common stock $5 stated value (900,000 shares authorized, 620,000 shares issued)................. $3,100,

Q. Determine expected future cash flows? A rights issue will be a smart source of finance to Tirwen plc as it will reduce the gearing of the company. The current debt/equity ra

Q. Estimate cost of equity using market values? The cost of equity as well as cost of debt should always be estimated using market values. If the approximate cash flows of a

Accounting Policies These financial statements have been prepared under the historical cost basis of accounting which is modified to accommodate the revaluation of certain proper

Safety Stock What must be the level of safety stock? In a simple condition where merely the usage rate is variable and the maximum usage rate can be given, the safety stock nee