Dora and Valentina Are Directors of a Company Called Guadalajara

Multiple Choice

Dora and Valentina are directors of a company called Guadalajara Pty Ltd ("Guadalajara") . Notwithstanding that Guadalajara has been very unprofitable for many years, it still has large amounts of cash on its balance sheet. Dora and Valentina are getting a lot of pressure from the company's shareholders to pay a dividend. Under the Corporations Act in order for a dividend to be paid, Valentina and Dora must ensure that:

A) The company has been profitable;
B) There is sufficient cash to pay the dividend at the time the directors declare the dividend;
C) The company's assets exceed its liabilities immediately before the dividend is declared and the excess is sufficient for the payment of the dividend;
D) The payment of the dividend is fair and reasonable to the company's shareholders as a whole;
E) The payment of the dividend does not materially prejudice the company's ability to pay its creditors.
F) All the above are correct.
G) (c) , (d) and (e) are required before the dividend can be paid.