INTERVIEW QUESTIONS FINANCIAL MANAGEMENT DIVIDEND DECISION DETAILS

Question: State the advantages of stock dividend for issuing company and to the investors.

Answer: A. Advantages for issuing company:-
1. Maintenance of liquidity position
2. Satisfaction of shareholders
3. Economical issue of capitalisation
4. Remedy for undercapitalisation
5. Enhance prestige
6. Widening the share for market
7. Finance for expansion programmes
8. Conservation of control
B. Advantages to the Investors:-
1. Increase in their equity
2. Marketability of shares is increased
3. Increase in income
4. Increase demand for shares

A. Advantages for issuing company:-
1. Maintenance of liquidity position
2. Satisfaction of shareholders
3. Economical issue of capitalisation
4. Remedy for undercapitalisation
5. Enhance prestige
6. Widening the share for market
7. Finance for expansion programmes
8. Conservation of control
B. Advantages to the Investors:-
1. Increase in their equity
2. Marketability of shares is increased
3. Increase in income
4. Increase demand for shares Source: CoolInterview.com

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