Question

When a company pays a dividend, it isn't as simple as getting a paycheck from one's...

When a company pays a dividend, it isn't as simple as getting a paycheck from one's employer. There are several critical dates in the dividend payment process. Identify which critical dividend date relates to each of the statements.

Statements

Declaration Date

Holder-of-Record Date

Ex-Dividend Date

Payment Date

Niagular Corp.'s board of directors announced that it will pay a $1 million dividend in three months on this date.
Niagular Corp. actually sent the dividend checks to stockholders on this date.
Niagular Corp.'s board of directors declared that whoever is listed as the owner of the stock on this date will receive the dividend for this year.
Niagular Corp.'s board of directors set this date as the date on which the right to the current dividend no longer accompanies the stock.
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Answer #1

Declaration date: The date on which the dividend is announced by board of directors
Date of record: Once dividend is announced, date of record is the date by which the shareholders must be on the register of shares to receive dividends/financial statements
Ex-Dividend date: The date by which the the shareholder must purchase the share to receive the dividend. The date is often set by the the stock exchange.
Payment date: The date by which the payment is made by the company.

a) BOD announcing that it pays $1 million dividend: Declaration date
b) Sent eh dividend checks to stockholders: Payment date
c) Whoever is on the list as the owner of the stock on this date will receive the dividend for this year: Date of record
d) Board of directors set this date as the date on which the right to current dividend no longer accompanies: Ex-dividend date

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