Cash Dividend
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Accounting for Companies Limited by Shares
MS: Dividen Tunai · EN: Cash Dividend · ZH: 现金股息
Meaning
A cash dividend is a distribution of part of a company's profit in the form of cash to shareholders as a return on their investment. It is declared by the board of directors and calculated based on the number of shares held. A cash dividend reduces the company's retained profit.
Example
For example, Jaya Bakti Berhad declares a cash dividend of 5 sen per share on 100,000 ordinary shares. The total dividend is RM5,000. Entry: Debit Dividend RM5,000, Credit Bank RM5,000 when the dividend is paid to shareholders.
Source: DSKP KSSM Prinsip Perakaunan Tingkatan 5