Dividend is paid on paid up value or face value?parveen sharma says its on paid up value but my 2 3 friend say its on face value...what to do,i also think its on face value?
19 Replies
CMA RAVI
(ASSISTANT MANGER - FINANCE)
(478 Points)
Replied 15 October 2012
@ ekta its on face value. :)
Back in the Game
(a)
(1273 Points)
Replied 15 October 2012
if i open a company ,issue a shares to u FV = 10 and u ve paid only 6 ,and i issue dividend at 10 % in mean time..why wil i pay u on something which u ve not invested..thus paid up value...
SAMIR KUMAR
(CA FINAL(GR. I CLEARED) CFA (IND))
(521 Points)
Replied 15 October 2012
ITS ON PAID UP VALUE DEAR.
SUPPOSE FACE VALUE IS Rs100 AND PAID UP VALUE IS Rs20. RATE OF DIV. IS 10%.
THINK LOGICALLY : - CO. WILL PAY U DIVIDEND ON THE AMOUNT U HV CONTRIBUTED TILL DATE AS CAPITAL i e ON Rs20 OR THE AMOUNT WHICH U HV STILL NOT PAID i e RS100.
OFCOURSE CO WILL PAY ON Rs20 @ 10% i e Rs2.
WHEN U WILL PAY NEXT CALL OF SAY Rs40 THEN UR TOTAL PAID UP VALUE WILL BE Rs60 AND DIV WILL BE BASED ON Rs60 @ 10% i e Rs6.
hope its clear now!!!!!!!!!!!!!!
Jatin Singh Negi
(Country Analyst )
(505 Points)
Replied 15 October 2012
Your doubt is easy to get resolved. The above answers are good enough to resolve the query.
Thanks guys for responding so nicely :))
Keep sharing the knowledge :))
Deepak Dargad
(Chartered Accountant....)
(9787 Points)
Replied 15 October 2012
@ Ekta ....Its On Paid Up Capital......................
Answer given by sameer....is very good...and enough to solve ur big doubt..
Rohit Kapoor
(CA Final)
(543 Points)
Replied 15 October 2012
If investment carry fixed intt rate then its paid on face value eg debentures....dividend is paid on paid up value .
Rohit Kapoor
(CA Final)
(543 Points)
Replied 15 October 2012
You frnds might get confused betwwen share and debenture.
Anuj Jain
(pqr)
(94 Points)
Replied 15 October 2012
ekta 100% sure, dividend is paid on paid up value only
CA. JAIN
(Chartered Accountant)
(466 Points)
Replied 15 October 2012
Now one more question arise...if share are issued at discount or at premium....????then
eg. face value 100
issue price 90 or 110
then prem @ 10% will be calculated on ......or........??????????
Sekar
(Student)
(197 Points)
Replied 16 October 2012
Dear Friends,
Nicely Explained.......
Thanks.......
shalu gupta
(student)
(70 Points)
Replied 16 October 2012
i also take classes fron praven sharma and i will be absolutely on paid up value ..above reasons are enough to resolve ur query
Yash Somani
(Article Assistant)
(106 Points)
Replied 16 October 2012
Ekta 100% it is paid up on paid up value and the example given by Samir kumar is enogh to understand this topc......
Karan
(Job)
(209 Points)
Replied 16 October 2012
Dividend on face value only if paid up and face value are same..otherwise it should be on paid up value.
The logic is already very well explained that you should get dividend on your amount paid towards capital as investment in share and not on the entire face value of share.
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