Practicing Success

Target Exam

CUET

Subject

Accountancy

Chapter

Accounting for Shares

Question:

What shareholders get as return from the company?

Options:

Share of profit

Dividend

Interest

Any of the above

Correct Answer:

Dividend

Explanation:

Shareholders receive "Dividend" as a return from the company. The dividend is a distribution of a portion of the company's earnings to its shareholders. It represents the financial reward that shareholders receive for owning shares in the company. Dividends are usually paid out of the company's profits and are a way for shareholders to share in the company's success and financial performance. While shareholders can also benefit from any appreciation in the value of their shares (capital gains), dividends are a direct form of return that provides periodic income to shareholders.