Alabama § 10A-20-7.16 - Setting Apart of Earned Surplus.
Full text of Alabama Code of Alabama § 10A-20-7.16 — Setting Apart of Earned Surplus., with citation guidance and answers to common questions.
§ 10A-20-7.16. Setting Apart of Earned Surplus.
Each year, the corporation shall set apart as earned surplus not less than 10 percent of its net earnings for the preceding fiscal year until the surplus shall be equal in value to one half of the amount paid in on the capital stock then outstanding. Whenever the amount of surplus established herein shall become impaired, it shall be built up again to the required amount in the manner provided for its original accumulation. Net earnings and surplus shall be determined by the board of directors, after providing for such reserves as the directors deem desirable, and the determination of the directors made in good faith shall be conclusive on all persons.
Source: official Alabama text · Last verified 2026-08-27
Frequently Asked Questions About Alabama § 10A-20-7.16
What does Code of Alabama § 10A-20-7.16 cover?
Section 10A-20-7.16 ("Setting Apart of Earned Surplus.") is part of the Code of Alabama, the codified statutory law of Alabama. It sets out the legal rule or procedure described in the text above. Statutes are amended regularly, so always verify against the official source.
How do I cite Alabama § 10A-20-7.16?
A common citation format is "Code of Alabama § 10A-20-7.16" (Alabama). Legal writing may require the code abbreviation, section number, and year or edition. Match the style required by your court, professor, or publisher.
Is this the official text of Alabama law?
No. This page is for research and education and may not include the most recent amendments. For official current law, check the Alabama official source linked on this page or consult a licensed Alabama attorney.
How does Alabama § 10A-20-7.16 apply to my situation?
Statutes are interpreted in context, and application depends on your specific facts. Only a licensed attorney in Alabama can advise on how this section applies to you. Contact your state or local bar association for a referral.
Sources & Verification
Not legal advice. Verify against the official source and consult a licensed attorney in Alabama.