CAF-4 · Chapter 23 · Question 3 of 7
The Board of Directors of Steel Mills Ltd proposed a final dividend of Rs. 5 per share. During the AGM, the shareholders feel the company made exceptional profits and want to increase the dividend to Rs. 8 per share. Can they do this?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) No, members in a general meeting cannot increase the amount of dividend proposed by the directors.
Explanation
Members at an AGM have the right to accept, reject, or decrease the dividend recommended by the board of directors, but they strictly cannot increase it.
More Distribution of profits MCQs
- Q5If the Chief Executive Officer (CEO) of a listed company willfully delays the payment of a declared dividend beyond the stipulated 10…
- Q6A company revalues its investment property, generating an unrealized gain of Rs. 10 million on its income statement. Can the company…
- Q7For what maximum continuous duration can a company close its register of members in a single year to process dividend payments?
- Q1During an Annual General Meeting, what restriction applies to the members regarding the final dividend proposed by the board of directors?