10.3 Forms of dividend: script dividend, cash dividend, stock dividend, bond dividend, property dividend

Forms of Dividend:

1. Cash Dividend: Cash dividend is the most common form of dividend. It involves the distribution of cash to shareholders based on the number of shares they own. Cash dividends can be paid quarterly, semi-annually, or annually, depending on the company’s dividend policy.
2. Stock Dividend: In a stock dividend, also known as a bonus share, additional shares of the company’s stock are distributed to shareholders instead of cash. The dividend is paid in the form of additional shares, typically at a certain percentage of the existing shares held by the shareholders. Stock dividends increase the number of shares outstanding but do not impact the overall value of the investment.
3. Scrip Dividend: Scrip dividend, also known as a dividend reinvestment plan (DRIP), allows shareholders to receive additional shares of the company’s stock instead of cash dividends. Shareholders have the option to reinvest their cash dividends into additional shares, thereby increasing their ownership in the company.
4. Bond Dividend: Bond dividend, also known as a bond or debenture dividend, involves the distribution of interest-bearing bonds or debentures to shareholders as a form of dividend. These bonds carry a fixed interest rate and have a maturity date. Bond dividends provide shareholders with an investment instrument that generates regular interest income.
5. Property Dividend: Property dividend involves the distribution of non-cash assets, such as securities, real estate, or other tangible assets, as dividends to shareholders. Instead of cash or additional shares, shareholders receive ownership or title to the property being distributed. Property dividends are relatively less common compared to cash or stock dividends.