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Explain the following forms of dividend: (i) Stock dividend. (ii) Scrip dividend.

      

Explain the following forms of dividend:
(i) Stock dividend.
(ii) Scrip dividend.

  

Answers


Francis
Explanations of the following forms of dividend
Dividends refers to distribution of profits of a company to its shareholders. It can be in the form of cash, stock, or property. Stock and scrip dividend are used where there is cash shortage or the company wants to invest cash available.
(i) Stock dividend – this is dividend paid to shareholders in form of shares.
(ii) Scrip dividend – this is where a company offers its shareholders the right to receive additional shares in future. It’s also called liability dividend.
francis1897 answered the question on November 7, 2022 at 08:45


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