How do stock dividends differ from cash dividends


Discussion Post: Investments

• What are the advantages associated with dividend reinvestment plans?

• How do stock dividends differ from cash dividends? How do stock dividends differ from stock splits?

• If a preferred stock is in arrearage, what does that imply about the dividend payment?

• What does the statement of cash flows add to the analyst's knowledge of the firm?

o 10 percent stock dividend ( fair market value of stock is $ 13 per share) pay out 10% of 1,000,000 shares= # shares
o FMV=$13

o A cash dividend of $ 1 per share will pay out $1 to every share holder. Cash is now $19,000,000 retained earnings is now $97,500,00

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Financial Management: How do stock dividends differ from cash dividends
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