Shareholders of a company are entitled to receiving what is known as dividends which are bonuses that investors get if the company does well while their money is with the company. Now one should take note that there are many different types of dividend payments that he can earn. So if one is interested in becoming an investor, then he definitely has to take note of these.
Number one on the list would be the most common type which is known as the cash dividend. Now the board of directors would probably want to give rewards to their investors in the form of cash which is known as the cash dividend. Now the two most important things to take note of here is that the basis of the amount is the principal investment and that there are two dates to remember namely the date of declaration and date of payment.
Another kind would be stock dividends which are the types that are not in the form of cash but in the form of shares of stock. Just like the cash dividends, there would be a declaration date as well as a date of payment wherein one would get his dividends. Now one very important thing to take note would be that only those who have common shares may avail of stock dividends.
Now one very good example that one can use would be when he would invest in the stock market. Now whenever one would invest in a public listed company, he would also be entitled to bonuses. Now instead of receiving cash, he would be receiving for example, twenty five percent or basically the agreed percentage of the stocks that he invested in.
The third on the list would be property dividends. Now instead of money types, the board of directors may want to give dividends that take the form of property instead. Now probably the most important thing to take note of here is that when it is handed over to the investor, it is always recorded in its fair market value.
Now there would also be the scrip dividends. Now these are usually given as IOUs in the event that the company has insufficient funds or money at hand. So the company would issue a promissory note to the investor on when the company will pay.
Finally, there would be liquidating dividends which are usually given whenever a company would already be ready to close and the board would still want to end on good terms with the investors. Now basically, the board of directors would be returning the principal amount invested by a shareholder in the form of dividends. This is usually done in the liquidation stage of closing down hence the name of the dividend is liquidating divided.
So basically, these are some of the kinds that one may have to know of. Now it is hard to further explain these kinds which is why it is good for one to attend seminars that would tackle this topic. In fact, there are a lot of seminars like these in the city of Florida which is the home of many investors and many small businesses.
Number one on the list would be the most common type which is known as the cash dividend. Now the board of directors would probably want to give rewards to their investors in the form of cash which is known as the cash dividend. Now the two most important things to take note of here is that the basis of the amount is the principal investment and that there are two dates to remember namely the date of declaration and date of payment.
Another kind would be stock dividends which are the types that are not in the form of cash but in the form of shares of stock. Just like the cash dividends, there would be a declaration date as well as a date of payment wherein one would get his dividends. Now one very important thing to take note would be that only those who have common shares may avail of stock dividends.
Now one very good example that one can use would be when he would invest in the stock market. Now whenever one would invest in a public listed company, he would also be entitled to bonuses. Now instead of receiving cash, he would be receiving for example, twenty five percent or basically the agreed percentage of the stocks that he invested in.
The third on the list would be property dividends. Now instead of money types, the board of directors may want to give dividends that take the form of property instead. Now probably the most important thing to take note of here is that when it is handed over to the investor, it is always recorded in its fair market value.
Now there would also be the scrip dividends. Now these are usually given as IOUs in the event that the company has insufficient funds or money at hand. So the company would issue a promissory note to the investor on when the company will pay.
Finally, there would be liquidating dividends which are usually given whenever a company would already be ready to close and the board would still want to end on good terms with the investors. Now basically, the board of directors would be returning the principal amount invested by a shareholder in the form of dividends. This is usually done in the liquidation stage of closing down hence the name of the dividend is liquidating divided.
So basically, these are some of the kinds that one may have to know of. Now it is hard to further explain these kinds which is why it is good for one to attend seminars that would tackle this topic. In fact, there are a lot of seminars like these in the city of Florida which is the home of many investors and many small businesses.
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If you would to know more about the types of dividend payments available, check out this link to The Declaration of Dependence Dividends in the Twenty-First Century. To order the book, come to http://financial-economics.org now.
