Question

globe hotels has more cash on hand than is required to support its operations. accordingly, the company has decided to pay out some of its earnings in the form of cash to its shareholders. what are these payments to shareholders called? multiple choice dividends stock payments repurchases payments-in-kind stock splits

Answer 1

These payments to shareholders are called Dividends. The correct option is A.

Why are dividends paid?

Dividends are payments made to shareholders based on the number of shares they own. Shareholders expect profits to be returned to them by the companies in which they invest, but not all companies pay dividends.

A dividend is a monetary or non-monetary reward given by a company to its shareholders. Dividends can be paid in a variety of ways, including cash, stock, or any other form. The dividend of a company is decided by its board of directors and must be approved by the shareholders.

Thus, the ideal selection is option A.

Learn more about Dividend here:

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