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The date considered for dividend payment or bonus issue by companies to shareholders is typically known as the "record date." Shareholders must own the stock before this date to be eligible for the dividend or bonus issue. The company usually announces the record date alongside the ex-dividend date, which is the date on which the stock must be purchased to qualify for the upcoming dividend. Payments are then made on the specified payment date.
There are three important dates when dealing with dividends. When the Board of Directors "declares" the dividend, the business has a legal obligation to pay the dividend to the shareholders. The posting on this date is Dr. Dividends Cr. Dividends Payable - to record dividend declared by the Board of Directors The next date is the "record" date. This determines who gets the dividends. Those that own the shares on the record date will receive the dividend. No posting is required on the record date. The final date is the "payment" date. This is the date the business writes the cheques to the holders of the shares on the record date. Dr. Dividends Payable Cr. Cash - to record payment of the dividend When the Board of Directors announces the dividend, it will state the record date and payment date.
The date the board of directors announces that a dividend is declared is called the "declaration date." On this date, the company formally approves the dividend payment and specifies the amount, as well as the payment and record dates. This announcement informs shareholders about their entitlement to receive the dividend.
The date that determines which shareholders will receive a cash dividend distribution is known as the "record date." This is the cutoff date set by the company, after which new shareholders will not receive the upcoming dividend. Shareholders who are on the company's books as of the record date are entitled to the dividend payment. Typically, the ex-dividend date is set one business day before the record date, which is when the stock starts trading without the value of the upcoming dividend.
There are 3 important dates to consider with dividends; the declaration date- when a board declares it's intention to pay, the date of record - the date from which stockholders are entitled to the payment, the payment date - is the date the dividend will actually be given to shareholders.
A declared cash dividend is recorded by debiting the dividend account and crediting the dividend payable account.
Once a dividend is declared by a company's board of directors, the payment date is typically set for a specific date, often a few weeks to a couple of months later. The timeframe can vary depending on the company's policies and local regulations, but companies usually aim to pay dividends within a reasonable period after the declaration. Shareholders must be on record by the ex-dividend date to receive the payment.
[Debit] Accounts receivable [Credit] Service sales revenue
You can sell the stock whenever you want, but you need to own it on the date of record to get a dividend. That means you need to buy it BEFORE the ex-dividend date.
if you sell shares on ex div. date,before the record do you still receive the dividend
Dr Cash at Bank $5000Cr Accounts receivable - MK Kapital $5000(To record payment from debtor/accounts receivable - MK Kapital)
The portion corporate profits paid out of stockholders is A dividend is quarterly payment to stockholders of record, as a return on investment. Dividends may be in cash, stock, or property, and are declared from operating surplus. If there is no surplus, the payment is considered a return on capital. Dividend payments are, in effect, taxed twice-once when corporate profits are taxed and again when the dividend is received by a taxpaying stockholder. The corporate profits paid out to stockholders is called dividends.