A cash dividend is a distribution of cash to shareholders by a company as a return on their investment. Cash dividends are typically paid out quarterly, although some companies may pay them semi-annually or annually. They are usually paid in the form of a check, but can also be deposited directly into shareholders’ bank accounts. … Read more
An accrued dividend is a dividend that has been earned by the shareholders of a company, but has not yet been paid out. This can happen when a company’s dividend payment date falls after its fiscal year-end. In this case, the dividend is said to be “accrued” until it is paid out to shareholders. What … Read more
A record date is the date on which a company’s shareholders are recorded in its shareholder register. This date is used to determine which shareholders are eligible to receive a dividend. A shareholder must be on the company’s register on the record date to receive the dividend. The record date is usually two business days … Read more
Convertible preferred stock is a type of investment that offers the shareholder both equity and debt features. The holder of convertible preferred stock has the right to convert their shares into a certain number of common shares at a set price, typically any time after a predetermined date. This type of security provides investors with … Read more
Dividends: What They Are and How They Work Why do stocks pay dividends? Dividends are a way for a company to share its profits with its shareholders. When a company earns a profit, it can either reinvest that money back into the business or it can distribute some of it to shareholders in the form … Read more
The Dividends Received Deduction (DRD) is a tax deduction that is available to shareholders of a corporation on dividends received from the corporation. The DRD is available to both individuals and corporate shareholders. The deduction is equal to the lesser of: 1. The dividends received from the corporation, or 2. 70% of the taxable income … Read more
The tax differential view of dividend policy, also known as the tax preference theory, is the idea that shareholders prefer dividends over other forms of corporate income because they are taxed at a lower rate. This theory suggests that companies should pay out dividends to shareholders whenever possible to maximize shareholder value. While the tax … Read more
The payment date is the date on which a company’s shareholders receive their dividend payments. For most companies, this date falls on the same day each year. However, some companies may choose to change their payment date from year to year. shareholders can find the payment date for their dividend payments by looking at the … Read more
An equalizing dividend is a dividend that is paid out to shareholders in order to equalize their ownership stake in a company. When a company raises new capital through the sale of new shares, existing shareholders may see their ownership stake in the company diluted. To make up for this dilution, the company may pay … Read more
An interim dividend is a dividend that is paid by a company before its financial year end. This is usually done in order to distribute some of the company’s profits to its shareholders before the end of the financial year. Interim dividends are usually paid out of the company’s profits from the previous financial year. … Read more
