Question

As a part of its capital structure Venus Limited had rupees 50 lacs as equity share capital and a loan of rupees 2000000 from neon Bank on earning a good profit Venus Limited decided to give dividend to equity share holder but was surprised when the Neon Bank impose restrictions on the payment of dividend identify the factor affecting dividend decision that allows neon Bank to impose restrictions on the payment of dividend by Venus Limited

Answer 1

Explanation:

As a part of its capital structure, 'Venus Ltd 'had R.s 50 Lakh as equity share capital and a loan of R.s 20 Lakh from neon bank. On earning a good profit, ...

Answer 2

As a part of its capital structure Venus Limited had rupees 50 lacs as equity share capital and a loan of rupees 2000000 from neon Bank on earning a good profit Venus Limited decided to give dividend to equity share holder but was surprised when the Neon Bank impose restrictions on the payment of dividend identify the factor affecting dividend decision that allows neon Bank to impose restrictions on the payment of dividend by Venus Limited is contractual constraints.

Explanation:

• Debenture interest is the money that the debenture owner is supposed to make after investing in the company's debenture.
• It is paid at a fixed rate based on the face value. Interest is a fee that must be paid by the corporation that issues debentures, regardless of how much money is coming in.
• It is a profit accusation. It is deducted prior to tax, preference dividend, and equity dividend payments.
• Earnings before tax are calculated by deducting debenture interest from earnings before interest and profit. Earnings Per Share (EPS) are calculated by dividing a company's revenue by the total number of outstanding shares of common stock.

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