Investment with cum.div. quotation-executorship laws, Financial Accounting

Investment with cum.div. Quotation

Investment with cum.div. Quotation will be debited to the investment account at its full value. When the dividend is subsequently received it is apportioned:

  • Amount accrued to death being credited to capital column of the investment account
  • Amount accrued after death being credited to the income column.

The amount apportioned to capital should be transferred out of the Investment Account (thus maintaining the investment at its probate value) and credited to Estate Capital Account.


          Example              Date of death:                          30th June, 20X5

                                      Stock:                                       6% Treasury Stock

                                      Interest paid:                                      1st March

                                                                                     30th September

                                      Holding:                                   Shs 2m quoted at 94-96


Investment Account


                        Nominal     Income      Capital                           Nominal     Income      Capital

20X5                              Sh'000          Sh'000          Sh'000   20X5                              Sh'000          Sh'000           Sh'000


June         Estate                                                                         Sept         Estate

30            Capital                                                                        30            Cash

                Account                                                                                     Book

                (stock                                                                                         (interest

                  at                                                                                              pre-death)                                                          30

                death)                2,000                                    1,890


Sept                                                                                                            post-death                                   30

30            Estate


                Account                                                              30


Posted Date: 12/13/2012 5:20:38 AM | Location : United States

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