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Calculate the dividend paid during the year

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Reference no: EM132822889

Question - ABC Limited is incorporated in Namibia. The company is preparing financial statement on the 31st of December 2020.

The following transactions were included in the financial statement.

(a) At the start of the accounting period the company has retained earnings of $500 000 and at the reporting date retained earnings are $700 000. During the reporting period a profit for the year of $450 000 was reported.

(b) The opening tax liability on the 1st of January 2020 was N$50 000 and on 31 December 2020 the financial report had a tax liability of N$90 000. During the same year the tax charged in the statement of profit or loss was $100 000.

(c) The company had an amount of computer equipment of N$100 000 as of 1 January 2020. The accountant charged depreciation of $20 000 during the year using the straight-line method as required by the company policy and a revaluation surplus of $60 000 was recorded. During the same year computer equipment with a carrying amount of N$15 000 was sold for N$20 000.

(d) During the year cost of sales amounted to N$750 000.The opening and closing balances on inventory amounted to N$350 000 and N$400 000, respectively. The opening and closing balances on accounts payable are N$150 000 and N$75 000, respectively.

Required - Calculate the dividend paid during the year. Refer to part (a) of the scenario.

Reference no: EM132822889

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