MANAGEMENT

Detailed explanation-1: -Dividend is that portion of profit which is distributed to shareholders. The decision involved here is how much of the profit earned by company (after paying tax) is to be distributed to the shareholders and how much of it should be retained in the business. Was this answer helpful?

Detailed explanation-2: -A decision has to be taken whether all the profits are to be distributed, to retain all the profits in business or to keep a part of profits in the business and distribute others among shareholders. The higher rate of dividend may raise the market price of shares and thus, maximize the wealth of shareholders.

Detailed explanation-3: -The third major financial decision relates to the disbursement of profits back to investors who supplied capital to the firm. The term dividend refers to that part of the profits of a company that is distributed by it among its shareholders.

Detailed explanation-4: -Dividend payout ratio is a proportion of dividend per share and earning per share. It signifies that how much is the dividend paid to the shareholders against the earning per share. Was this answer helpful?

Detailed explanation-5: -A dividend is a share of profits and retained earnings that a company pays out to its shareholders and owners. When a company generates a profit and accumulates retained earnings, those earnings can be either reinvested in the business or paid out to shareholders as a dividend.