Please guide me about proper treatment of proposed dividend in different situation
Proposed dividend is one of the adjustments that is normally tested in every Cash Flow adjustment problem. In this, following treatment is to be provided based on information provided to us.
Let’s try to understand this through an example. Suppose following things are provided in the question.
| S.No. | CY Balance | PY Balance | Related Adjustment |
|---|---|---|---|
| 1 | 10,000 | 7,500 | No |
| 2 | Nil | 7,500 | No |
| 3 | 10,000 | Nil | Nil |
| 4 | Nil | Nil | Dividend Paid – Rs 7,000 |
| 5 | 10,000 | 7,500 | Dividend Made - Rs 5,000 |
