Types of dividend policy, Financial Management

Assignment Help:

TYPES OF DIVIDEND POLICY

1. Regular dividend policy: Payment of dividend at standard rate is known as regular dividend policy.

2. Stable dividend policy: Payment of fixed minimum amount of dividend regularly is known as stable dividend policy.  This may take the form of one of the following forms.

Constant dividend per share:  Fixed dividend per share is paid irrespective of earnings year after year and a reserve for dividend equalization is created to cover the fluctuations in earnings.

Constant Payout Ratio (P/O):  Under Constant Payout Ratio policy, a predetermined percentage of earnings is paid as dividend every year.

Stable rupee dividends plus extra dividend:  Under Stable rupee dividends plus extra dividend technique, a constant low dividend per share is paid, with an extra dividend in years of high profits.

3. Irregular dividend policy:

Under Irregular dividend policy, dividend payment is irregular.  The dividend policy depends on so many other factors which may have a direct impact on the availability of funds in the company.

4. No dividend policy:

Under No dividend policy, the company has a policy of not paying dividend to any share holder.


Related Discussions:- Types of dividend policy

Define limit of theory of comparative advantage is realistic, What consider...

What considerations might limit the extent to which the theory of comparative advantage is realistic? Answer: The theory of relative advantage was initially advanced by the ninet

Prepare monetary statements using accounting standards, Entity A is signifi...

Entity A is significantly smaller than B in terms of revenue and would not impact LOP's revenue to the same extent. However A earns a noticeably better gross profit margin at 26% a

State the major decision of financial management, State the major decision ...

State the major decision of financial management The major decision of financial management is the decision relating to dividend policy. The dividend must be analysed in relat

Price Earnings, what is the relationship between industry pe and comapny''s...

what is the relationship between industry pe and comapny''s pe?

Explain that many u.s. firms simply do not hedge, Recent surveys of corpora...

Recent surveys of corporate exchange risk management practices point out that many U.S. firms simply do not hedge. How would you explain this result? Answer:  There can be severa

Multicollinearity, Multicollinearity As the degree of correlation betwe...

Multicollinearity As the degree of correlation between the independent variables increases, the regression coefficients become less reliable. That is, although the independent

Stakeholder vs shareholder approach, QUESTION 1 (a) What do you underst...

QUESTION 1 (a) What do you understand by the term Civil Society Organisations? (b) Distinguish between sectional and promotional groups. Give examples to support your answer

How to calculate payment of expenses, How to calculate payment of expenses:...

How to calculate payment of expenses: SAIB, LLC is a US company that provides cell phone and internet service; it seeks to expand its international operations into Kyrgyzstan.

Types of traders in future and option markets, Types of Traders in Future a...

Types of Traders in Future and Option Markets: Hedgers Hedgers use the futures and options market principally for risk management purposes because of their exposure to pri

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd