Dividends are payment paid by the company to its share holders from the profit it earned in that quarter. It is paid as a portion of the profit. Usually dividends are paid in form of cash know as cash dividends. It is not the same in all the case; however it is paid in form of cash in most of the case. When a company earns a profit it can be used up in two ways. It can be either given as dividends or can be used for future expansion purpose. The paying of the dividend need not be same by all the companies. For ex. The joint stock companies pay fixed dividends at regular interval, whereas public companies pays dividend based on their income but not on a regular basis. They pay dividend on a special occasion which is called as special dividend. Cash dividends will be usually in the form of E-fund or cheques. These funds are subjected to tax for the investors. The dividends are usually announced for each shares and the investor earns money based on the number of shares he/she holds.
The dividends are usually declared by the board of directors. The investors must know the following dates to earn dividends from the company they are,