Ch1 S8

Front 1

Dividend

Back 1

Portion of comapies profit that is paid to its stockholders in the form of cash,stock or property

Front 2

Types of dividend payment

Back 2

1.Cash(most common)
2.Stock-most likely paid by companies with a small cash balance
3.Stock of other companies owned by the corporation
4.Treasury stock
5.Products

Front 3

Dividends are paid on

Back 3

1.Common stock
2.Preferred stock
3.Mutual fund shares
4.American Depository Receipts(ADR)

Front 4

ADRs

Back 4

American Depository Receipt- Foreign securites held at american banks in foreign countries traded on an American exchange. Receipt is the proof of ownership,not stock
-They have no voting privilege
-Dividends are paid in US dollars
-Not issued as callable
-Taxed as security and gains & losses are reported on IRS for 1099b

Front 5

Dividends are not paid on

Back 5

Warrants and bonds

Front 6

Facts about dividends

Back 6

1.Corporations are not required to pay dividends to c/s holders.
2.Dividend must declared by BOD before c/s holders are legally entitled to them.
3.Cash dividends paid are fully taxable on fed,state and local level
4.On the date a corporations declares a cash dividedn on c/s, it becomes a CURRENT LIABILITY. When the cash dividend is paid, the current liabilities will DECREASE on the balance sheet.
5.The amount of dividends significantly affects and determines a stocks market price

Front 7

Declaration date

Back 7

date on which a dividend is declared by the BOD

Front 8

ex-dividend date

Back 8

ex(without)-the second business day before the record date. Must owner security 1 business day prior to ex date in order to receive dividend.

Exception:The ex-date for cash transactions is the business dat after the record date

Front 9

Record date

Back 9

persons whos name appears on the corporations books as of this date will receive dividend

Front 10

payable date

Back 10

date the dividend is actually paid

Front 11

Due bill

Back 11

Used by broker dealers to adjust for incorrect dividend payments made by corporations.