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that part of the net earnings of a corporation that is distributed to its stockholders. Dividend disbursements are based on a percentage of the par value of the stock or are a certain sum per share of no-par-value stock. They become payable only when approved by the board of directors and are usually declared at regular intervals. Obviously, dividends should not be paid unless the company has accumulated a profit or surplus. In the United States, dividends may be paid in property of various kinds, including bonds and stocks of the company or stocks of other companies first acquired for other purposes, in notes, or in cash. Dividends may be paid in stocks when the accumulated profits of a company are to be retained for reinvestment in the business. Dividends in the form of notes, often called scrip dividends, are rare; they are only paid when the company has earnings that it expects to convert into cash before the notes are due. In Great Britain, dividends are payable only in cash. Liquidation dividends are the return of the capital of a business that is being terminated. Enterprises with diminishing assets, such as mines, issue a modified form of liquidation dividend. The dividend from preferred shares of stock is a fixed percentage that must be paid before the remainder of the profit is divided among other shares. If there are not enough profits to pay the whole dividend on preferred stock, future profits may be assigned to pay back those dividends before anything is paid on common stock. Preferred stock is ranked as first and second preferred, according to the priority of its obligations. Preferred dividends differ from interest on bonds in that there is no default if the former are not paid. The term dividend is also used to refer to a fractional payment of the amount owed by a bankrupt firm to a creditor.



the part of the profit made by a stockholding company that is distributed each year among the stockholders.

On the common shares the dividend is paid out in accordance with the amount of profit made by the corporation during a given year. On the preferred shares the size of the dividend is set beforehand in the form of a fixed percentage. With the growth of the share capital the total sum of the dividend also grows, and most of it goes to the large stockholders. The growth of dividends is one of the indicators of the increased income of the parasitic class of rentiers.


A quantity which is divided by another quantity in the operation of division.


1. Maths a number or quantity to be divided by another number or quantity
2. Law the proportion of an insolvent estate payable to the creditors
3. Finance
a. a distribution from the net profits of a company to its shareholders
b. a pro-rata portion of this distribution received by a shareholder
4. the share of a cooperative society's surplus allocated at the end of a period to members
5. Insurance a sum of money distributed from a company's net profits to the holders of certain policies
References in periodicals archive ?
It also states that treating stock redemption payments as deductible dividends under Sec.
24410 provided for a dividend-received deduction for dividends paid by an 80 percent or more owned insurance corporation to the extent that the insurance corporation was subject to the California gross premiums tax.
But dividends for cash cow Microsoft are easy: The company doesn't need to sink all of its earnings into R&D or acquisitions.
Until 1988, the Chicago-based building materials company had paid a dividend for many years.
But because stocks have charged further and further upward over the past three years, dividends have lost much of their luster.
If a section 482 adjustment were subsequently made, the resulting interest and penalties could prove onerous to the taxpayer in the absence of the dividend offset procedure.
The company's dividend policy and future dividend payment considerations.
332 liquidation of an insurance company into a noninsurance company, the latter is treated as receiving a dividend subject to the applicable DRD on "qualified dividends" (CRTC [section]24465(h)(2)).
The Department's theory is premised on its view that foreign dividends paid by a non-U.
As a whole, electric utilities have not had stellar earnings or dividends this year.
KCS' improved operating performance for the first nine months of 2006, as evidenced by a substantial year-over-year increases in operating income and EBITDA, allows us to restore dividend payments at this time," stated Chairman and Chief Executive Officer Michael R.
965(a)(1), the election only applies to actual cash dividends, not to any deemed dividends or foreign tax credit (FTC) gross-ups.