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By providing dividend to share holder

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Q: How can you utilise the general reserve?
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Differentiate between general and specific reserve?

differentiate between general and specific reserve?


What is the difference between general reserve and revenue reserve?

A reserve which is created out of the revenue profit is called revenue reserve. Revenue profit is earned in the normal course of the business. Revenue reserve refers to the undistributed revenue profit. It is created for strengthening the financial position, replacing deprecialble assets, redeeming liabilities, declaring uniform rate of dividend and conducting research and development functions. If the reserve is not needed in the future, it can be distributed as dividend to the shareholders.There are two types of revenue reserve:a) General ReserveA reserve which is created out of the profit not for a specific purpose is known as general reserve.General reserve is used for general purpose as per the discretion of the management. Usually, general reserve is used for strengthening the financial position and meeting future contingencies and losses.b) Specific ReserveA reserve which is created out of the profit for a particular purpose is known as specific reserve. Such reserve can not be utilized for any purpose other than specified. Specific reserve is created by debiting the profit and loss appropriation account. It can be invested in outside securities. It serves for a specific purpose as to equalize dividend or to redeem a fixed liability or to replace a fixed assets or to conduct a research and development work.The following are the important types of specific reserve:* Dividend equalization fund* Sinking fund* Research and development fund


Is capital reserve a free reserve?

capital reserve is not a free reserve


How profits are distributed in public limited company?

used to service loans use to pay corporate tax set aside as general reserve


What is amalgamation reserve?

Amalgamation reserve means the expenses bear by Transferee company for amalgamation with Transferor company is treated as reserve, this reserve is called as amalgamation reserve

Related questions

How you can increase general reserve when your profit has also decreased?

how can we increase the general reserve


Differentiate between general and specific reserve?

differentiate between general and specific reserve?


After redemption of debenture debenture reduption reserve where to transfer whether in PL Ac or in General reserve.?

After redemption of debentures, debenture redemption reserve is to be transferred to general reserve.


When was State General Reserve Fund created?

State General Reserve Fund was created in 1980.


How do you spell utilise?

utilise


What will be Journal entry for purchase of building from general reserve account?

General reserve account cannot be used for purchases of building as general reserve accounts is fixed for some limited kind of transactions like


Why debenture redemption reserve is transfer to general reserve?

When debentures are redeemed payment is made from a reserve which is created at the time of purchase of such debentures,therefore at the time of payment first it is transferred to general reserve then as it is expenditure to company.


What are the example of Revenues?

Revenue reserve is created out of revenue Profit . It is created out of Revenue Profit for exaple General Reserve, Dividend equalization reserve, Investment fluctuation reserve etc.


Boring in holidays how it can utilise usefully?

Boring in holidays how it can utilise usefully?


What is the past tense of utilise?

The past tense of "utilise" would be "utilised".


What is the general ledger journal entry to begin a Reserve Account?

debit reserve accountcredit cash / bank


In tally general reserve goes to which group?

capital