Variation of securities-executorship laws and accounts, Financial Accounting

Assignment Help:

Variation of securities

It would seem logical to carry out a strict apportionment between income and capital every time investments are bought or sold. If this were done, it would be necessary to divide the purchase price or sale proceeds between the pure capital element and the adjustment of income rights.

In practice, this is not done, following the rules of convenience, on the grounds that it unnecessarily complicates the accounts.  The situation is, therefore, as follows:

1. Purchase of investment cum. div.  The life tenant is entitled to the whole income when received, except where the investment is purchased cum. div. after the dividend has been declared, when the whole dividend goes to capital (Re. Peel's Settled Estates).

2. Disposal of investment cum. div. The life tenant is not entitled to any of the sale proceeds (Scholefield v. Redfern).

3. Disposal of investment ex. div.  The whole dividend received after disposal belongs to the life tenant. Any organized course of action to the detriment of the life tenant or the remainderman would be actionable by that party as a breach of trust.


Related Discussions:- Variation of securities-executorship laws and accounts

State the term - regulations, State the term - Regulations Financial acc...

State the term - Regulations Financial accounting reports, for numerous businesses, are subject to accounting regulations which try to make sure they are produced with standard

What are junk bonds, Q. What are Junk Bonds? Junk Bonds - DEBT SECURITI...

Q. What are Junk Bonds? Junk Bonds - DEBT SECURITIES issued by companies with higher than normal credit risk. Considered ‘non-investment grade' bonds, these SECURITIES ordinari

Calculate shares no., Q. Bento, Inc. had 500,000 shares of common stock out...

Q. Bento, Inc. had 500,000 shares of common stock outstanding before a stock split occurred, and 1,500,000 shares outstanding after the stock split. The stock split was a. 2-for-5.

What is reporting currency, 1. What accounting firm performed the audit of ...

1. What accounting firm performed the audit of Zetar's financial statement? 2. What is the address of the company's corporate headquarters? 3. What is the company's reporting

Finacial management, There are two projects A and B. The initial capital ou...

There are two projects A and B. The initial capital outlay of A and B are Rs.1,35,000 and Rs.2,40,000 respectively. There will be no scrap value at the end of the life of both the

Describe accounting concept of a business combination, Describe the account...

Describe the accounting concept of a business combination. Business Combination: According to International Financial Reporting Standard-3 Business Combinations "A busi

What amount does eggers stand to lose, Q. Andy Eggers has invested $150,000...

Q. Andy Eggers has invested $150,000 in a privately held family corporation. The corporation does not do well and must declare bankruptcy. What amount does Eggers stand to lose? a.

Prepare a post-closing trial balance, Ocean Atlantic Co. is a merchandising...

Ocean Atlantic Co. is a merchandising business. the account balances for Ocean Atlantic co. as of July 1, 2012 (unless otherwise indicated), are as follows: 110 Cash 63,600 1

Example of continuous compounding, Determine the future value of Rs.1000 co...

Determine the future value of Rs.1000 compounded continuously for 5 year on the interest rate of 12 percent per year and contrast it along with annual compounding.   Solution :

Would you give to avoid such errors in the future, Notsofast Inc. acquired ...

Notsofast Inc. acquired land for $500,000 on 7/1/2010. It erroneously recorded the full amount as an expense. Explain what Notsofast must do when it discovers the error in 2011. Wh

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd