Which of the following reserves cannot be distributed as dividend to share holders?

Securities premium

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Profit on forfeiture of shares

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Profit on sale of fixed assets

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All of the above

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Solution

The correct option is D All of the above
Dividend can be distributed from the profits earned by the business from its business operations. Securities premium, profit on forfeiture of shares and profit on sale of fixed assets are not the item of business operations, hence dividend can not be distributed from these.

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