Calculate the amount of Dividend paid during the year 2022 from the following information.

Balance of Proposed Dividend as on 31st March, 2021 was Rs 40,000 and on 31st March, 2022 Rs 60,000 . Interim Dividend was paid @20% on share capital. Share capital was Rs 4,00,000.

Rs 1,20,000

The correct answer is option (2) : Rs 1,20,000.

Proposed dividend as on 31st March, 2021 = ₹40,000
Proposed dividend on 31st March, 2022 = ₹60,000

Interim dividend = 4,00,000 x 20/100
                        = 80,000

Dividend paid during the year = Proposed dividend as on 31st March, 2021 + Interim dividend
                                           = 40,000 + 80,000
                                           = 1,20,000

*Last year proposed dividend is paid in this current year.

Note- Proposed dividend on 31st March, 2022 = ₹60,000. It will be paid in the next year when it was declared by board of directors.