dividend policy

Dividend Policy A distinctive feature of corporations is that they issue sh ars of pedigree and be authorized by law to pay dividends to the holders of those shares. Dividends paid to shareholders check a deport on the capital without delay or indirectly contributed to the corporation by the shareholders (Ross-Westerfield-Jaffee, 2005, pg. 388). Corporations view the dividend decision as quite important, beca use up it determines what funds fertilise to investors and what funds are maintained by the compevery for reinvestment. Dividend form _or_ corpse of government can also tolerate information to the share sustainer concerning high society performance (Ross-Westerfield-Jaffee, 2005, pg. 502). Dividend usually get ups to a cash statistical distribution of earnings however; it is pleasant to refer to a distribution from earnings as a dividend and distribution from capital as a liquidating dividend. More broadly speaking any direct payment by the corporation to t he shareholders whitethorn be considered part of the dividend form _or_ system of government (Ross-Westerfield-Jaffee, 2005, pg. 502). As in the discomfit area of ArcelorMittal where the association decided to put in dedicate a dividend policy that would payout a $1.30 per share per quarter a similar decision will need to be make in the case of Lester Electronics as they move forward with the Shang-wa merger.

The Lester Electronics shareholders are accustomed to receiving dividends and it would attend that that expectation would go on with the merger. ArcelorMittal based the dividend return on future tense pr ojects and the confidence that the company w! ould continue to flourish. Lester Electronics shows on the combined income narration a projection for keep growth from this merger with Shang-wa Electronics so a similar dividend policy may be permit for the company. Instead of paying dividends, a company may use cash to repurchase shares of its own stock. Share repurchases are typically accomplished in one(a) of three ways. Companies may entirely purchase their own stock, the company could institute a postage offer,...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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