Q270
Which of the following is correct?
A.
The entire surplus would be distributed to policyholders
B.
The entire surplus would be distributed to shareholders
C.
A portion of the surplus would be left for distribution to shareholders
AnswerD.
All of the above
Answer: Option C
Solution
Answer: Option C
Solution:
Earned surplus is the sum of a company's profits, after dividend payments, since the company's inception. A portion of the surplus would be left for distribution to shareholders.