Originally posted by Martin at NixonWilliams
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Expenses V dividend
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Originally posted by Punter View PostI am an accountant and I don't think this is the case. A dividend of £100 will reduce the profit by £0.
But you could sensibly say that having got the profit, paying a dividend reduces it, or at least what's left of it.
Depends whether you mean the accounting amount of profit, or the money in the Co resulting from it.Last edited by Ignis Fatuus; 2 November 2012, 09:25.Job motivation: how the powerful steal from the stupid.Comment
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Originally posted by Punter View PostI am an accountant and I don't think this is the case. A dividend of £100 will reduce the profit by £0.
Say your company has made a profit of £5K (after corp tax and other expenses).
You then take a £100 dividend.
How much profit is left in the company?Contracting: more of the money, less of the sh1tComment
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Originally posted by Punter View PostI am an accountant and I don't think this is the case. A dividend of £100 will reduce the profit by £0.
I was referring to the effect on the retained earnings.
In the context of the question (i.e. expenses vs. dividend) it is important to recognise how each option effects the retained earnings as a whole.
MartinComment
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Originally posted by Punter View PostI am an accountant and I don't think this is the case. A dividend of £100 will reduce the profit by £0.
AlanComment
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Originally posted by Nixon Williams View PostI think Martin meant to say that a dividend will reduce the retained profit by £100.
AlanComment
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