Which of the following is not a type of dividend payment?
A
Bonus Issue
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B
Right Issue
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C
Share Split
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D
Both B and C
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Solution
The correct option is D Both B and C A bonus issue, also known as a scrip issue or a capitalization issue, is an offer of free additional shares to existing shareholders. A company may decide to distribute further shares as an alternative to increasing the dividend payout.
A rights issue is an invitation to existing shareholders to purchase additional new shares in the company.
A stock split is a decision by a company's board of directors to increase the number of shares that are outstanding, by issuing more shares to the current shareholders.