The date that determines who is to be considered a stockholder for the purpose of receiving a dividend is the:
a. declaration date.
b. record date.
c. payment date.
d. distribution date.
A company listed on the stock exchange usually pays dividends in the form of returns to its shareholders. There are several dates that are used in the context of dividend payment, namely, declaration date, ex-dividend date, record date, and payment date.
Answer and Explanation: 1
The correct answer is option b. record date.
A shareholder who holds the shares of a company before the ex-dividend date is entitled to receive the dividends. The record date is usually one business day after the ex-dividend date. An investor who buys the shares just before the ex-dividend date usually receives them on the record date and, such an investor, is seen on the records/books of the firm.
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fromChapter 16 / Lesson 1
Dividends are incentives in the form of payments to shareholders of a company. Explore the different types of dividends and the standard method of payments that they occur in.