From a company’s perspective explain the significance of the following events Stock Splits Stock Dividends Cash...
From a company’s perspective explain the significance of the following events
Stock Splits
Stock Dividends
Cash Dividends
Homework Answers
Ans. : From a company's perspective, significance of events is as follows :
* Stock Splits : In stock split basically company increase the number of outstanding shares by issuing shares to the current shareholders. Underlying value of the shares does not get changed in it. It attracts more investors.
For example : Rs. 10 share is splitted into 5 shares of Rs. 2 each.
* Stock Dividends : In this shares are distributed to the shareholders based on their ownership in place of cash payment. This is the return which they get for investing in the company.
* Cash Dividends : It is a payment made by company out of profits to shareholders in form of cash. It attracts investors and build a demand for the company shares in market.
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From a company’s perspective explain the significance of
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