Maximum dividend from revaluation reserve Steps:

• Note number of ordinary shares: 500,000.
• Identify distributable reserve: revaluation reserve of $250,000 (share premium is non-distributable).
• Compute total maximum dividend payable: $250,000.
• Divide by shares for per share amount: $250,000 ÷ 500,000 =$0.50. Why A is correct:
• Under company law, revaluation reserve is available for dividend distribution once realized profits are confirmed. Why the others are wrong:
• B: Erroneously includes non-distributable share premium ($400,000 total ÷ 500,000 =$0.80).
• C: No basis for $0.90; miscalculation not tied to reserves.
• D: Overstates by assuming full equity distribution ($1.20 exceeds available reserves).

Final answer: A