Question

Explain why corporations issue stocks. Are corporations required to pay dividends? Explain. Why do corporations pay dividends? What are retained earnings, and why are they important. Explain your answer.

Answer 1

Answer :- paget money its pay 9 Earning corporation issue stock raise start up their business and that money is used or ongoing ties. Also shar e Stock creates ownership well form claim to portion assets and earning the companies. It is not_required pay any dividend at ave corporation may choose to give portion their or dividend shareholder the foro Incentive just Keep envesting in their corporation and also creates demand for their Stock Retained Earnings are profit of the companies albich has been kept opposed them shareholders wag of dividends Amount 06 dividend paid is substracted from Retained distributing sanning

page 2 grow of as whether it is paid cash stock. Retained Earnings are very important for any business it helps reinvest the companies business gt important to the shareholder + shocos that how much money Equity they collectively the company. It es important the Board directors as well because shows how much they have reinvest to pay dividends. High level of retained barning show the good profitability the Entity and repay the debts Easily So 2+ also imp- ortant for the creditor also of Earning to can O