In case of proposed dividend does the dividend is already declared to the shareholders or it is just decided by the board of directors?

Open in App

Solution

Dear Student

Proposed dividend is the dividend which is suggested (proposed) byboard of directors, This proposed dividend shall be finalized by shareholders in general meeting.

Therefore Proposed dividend does not mean, dividend directly declared to shareholders.

Regards

Suggest Corrections

Similar questions

Corporate India has opened its purse strings to shareholders with interim dividends and bonus shares. At least 60 companies have declared an interim dividend or announced plans to do so in the first weeks of January. Also, around 12 companies have announced bonus share issues this month, about three times more than January 2006.

There is a range of things that a company can do for maximising shareholder value, and the dividend is the most direct and simple form of it. Ideally, companies need to balance the value of the stock for total shareholder returns.

This trend of dividends and bonuses is in synchronisation with the good profits being posted by companies. It is a way of rewarding shareholders. Many companies have also announced plans of bonus shares for their shareholders. Most of the companies who have already declared bonus issues or announced that they would be taking it up in their next board meeting are small or mid-sized companies.

What factors are considered while taking this decision?

Due to inefficient management and negligence of the Board of Directors, ABC Ltd. is sustaining huge losses but Board of Directors has paid dividends out of the share capital to hide these inefficiencies and to uphold the goodwill. But the Board of Directors has decided to pay very less dividend out of profits earned without giving any satisfactory' reason for this decision.

(i) What will be the immediate or short-run effects of ABC Ltd.'s decision?

(ii) Explain how or whether it will be beneficial for the company legally or otherwise?

Q. Dividends ________ declared for past years in respect of which the accounts were already closed.

Payment of fixed rate of dividend to preference shares may enable a company to declare higher rates of dividend for the equity shareholders in good times.

Q. is paid as a dividend to the shareholders.

Join BYJU'S Learning Program

In case of proposed dividend does the dividend is already declared to the shareholders or it is just decided by the board of directors?

Dear Student Proposed dividend is the dividend which is suggested (proposed) byboard of directors, This proposed dividend shall be finalized by shareholders in general meeting. Therefore Proposed dividend does not mean, dividend directly declared to shareholders. Regards

Dear Student

Proposed dividend is the dividend which is suggested (proposed) byboard of directors, This proposed dividend shall be finalized by shareholders in general meeting.

Therefore Proposed dividend does not mean, dividend directly declared to shareholders.

Regards