Am i right ? please reply....

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Dividend is belongs to shareholders, it not the money of the company concerned. Is it correct to show the dividend account in the balance sheet of the company ?

Replies (6)

Once the div is declared......it remains the liability of the company.........so it will be shown as liability in bal sheet till it's not claimed or not paid to shareholders.............

Both the shareholder and company having differant personalities need to be a/c for........

Please note that the dividend payable to shareholder's is the liability of the company.  It is requried to be provided in the P&L account on the last day of Mar31 and the liability to be shown as Proposed Dividend in the B/S which becomes Nil when the dividend is actually paid by the company when approved by the shareholders in the AGM.

for providing the dividend as of 31st Mar the entry would be as follows:

dividend Dr

To-Proposed Dividend

the payment entry in the subsequent eyar would be as follows:

Proposed Div A/c dr

To- Bank A/c

As dividned is not a tax deductible expense it is required to be shown as an appropriation from profits after providing for tax.

Dividend once declared is a liability to the comapny and hence will be shown in the balancesheet

It will be shown as laibility in the balance sheet once declared.

Agree with the above statements ..

once the dividend is declared it becomes the liablity of the co . It is shown in the left hand side of the bal sheet  in lia side

I think there's difference between dividend declared & dividend proposed.  When director's propose the dividend it is shown as as a liability as Proposed dividend in the B/S.  When the shareholders approve the dividend in the AGM then it is said to be as dividend declared & the co is bound to pay the dividend


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