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CA Intermediate · Advanced Accounting · Financial Statements of Companies

Under Schedule III (Division I), where would 'Unclaimed dividend' lying with a company at the Balance Sheet date be shown?

Unclaimed dividend is shown under current liabilities as 'Other current liabilities'. It is an amount already declared and owed to shareholders, payable whenever they claim it, so it is neither a reserve, a provision, nor a long-term liability.

  1. AUnder current liabilities as 'Other current liabilities'Correct
  2. BUnder Other Equity as a reserve
  3. CUnder non-current liabilities as 'Other long-term liabilities'
  4. DUnder provisions as 'Provision for dividend'

Explanation

Unclaimed dividend is an amount owed to shareholders and payable on demand, so it is a current liability shown under Other current liabilities. It is not a reserve and not a provision for estimated liability. It is not long term because the shareholders may claim it any time.

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